Gold coins have existed for 2,700 years and were used as a main form of currency until the Great Depression. They have broad appeal for their rarity and beauty.
Gold was used as currency for several reasons. It does not tarnish or corrode, and it can be melted and remade into different types of currency. It is also harder to make counterfeit gold coins.
For all of these reasons, such coins stand the test of time and are prized by collectors and investors alike!
If you’re considering starting a gold coin collection, it can be a rewarding experience. Owning gold coins might just make you feel like a king!
This article will be a big step for you to hopefully start a gold coin collection!
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What makes Gold Coins so valuable?
Gold coins are a great investment as they have 2 types of value, their intrinsic value, which comes from their precious metal content, and their numismatic or collector’s value.
The collector’s value is above and beyond the coin’s melt value and comes from the rarity and special qualities that interest coin collectors.
As the price of gold fluctuates, a gold coin’s intrinsic or melt value will fluctuate with it, but the collector’s value does not necessarily follow the same patterns.
When the price of gold climbs very high, people might sell gold coins for their melt value. This can decrease the amount of older gold coins available, making them even rarer!
Types of Gold Coins you Should Collect …
Not all gold coins are the same. There are several different types you may want to consider for your coin collection, including gold bullion, ancient, and pre-1933 gold coins.
Let’s explore each of these main categories to see what might be a good fit for your collection:
1. Gold bullion (modern gold coins)
Gold bullion coins are modern coins minted for their melt value and are not intended to have collector’s value as a primary purpose.
While they are sometimes considered legal tender, gold coins minted after about the 1930s are not intended for circulation.
Maintaining the condition of these coins is not of as much of a concern so long as they don’t lose weight.
Gold bullion are primarily for investors and not the coin collector. They are minted each year and are not considered rare, though some are created with lower mint numbers in an attempt to have collector’s value over time.
Examples of common types of gold bullion include:
- S. Gold Eagles
- Canadian Gold Maples
- Chinese Gold Panda
- South African Krugerrands
- Austrian Philharmonics
- British Britannia
- Gold Dinar
2. Ancient gold coins
As I’ve mentioned, these coins were the original form of coin currency beginning thousands of years ago. They were first used by the rich for large purchases and to fund armies, rather than for everyday transactions.
Becoming familiar with the history of gold coins will help you learn about their rich history and different types you may come across. We’ll review them in chronological order.
3. Ancient Persian coins
The king of Lydia is widely believed to have invented coinage, and this region was captured by the Persians, who adopted gold currency.
The Persians minted golden drams or darics until the area fell to Alexander the Great, who melted the currency and created his own…
…Therefore, ancient Persian gold coins are quite rare!
4. Ancient Chinese gold coins
From around 600 to 500 BCE, an early form of Chinese currency, the golden ying yuan was created. This currency is believed to have grown independently of Western coins.
The ying yuan coins were made of rough squares of gold and were stamped with symbols showing the coin’s denomination or weight.
5. Ancient Greek and Roman gold coins
Most ancient Greek and Roman coins were made of bronze, but some higher denominations were made of gold. Between 200 and 400 CE, the Romans minted millions of gold coins that spread across the Roman empire (Learn about metal detecting for Roman coins), including Europe and Britain. They are still found today throughout those regions.
An ancient Roman coin found in an English field by a metal detecting hobbyist sold in 2019 for $700,000. It is one of only 24 specimens known to exist in the world.
6. Medieval gold coins
Italy (Venice in particular) used African gold to mint gold coins starting in the 1200s. The rest of Europe was soon to follow, including France, England, Belgium, Spain, and the Netherlands. Types of gold coins from this era into the following centuries include the gold ducat.
7. Pre-1933 gold coins
From the 17th century with the discovery of gold in the Americas, the use of gold coinage resurged after a brief period in which silver was more popular. For around the next 300 years, gold coins were widely used across Europe and the colonies.
Coins minted during that time include gold guineas from England, which were produced in the millions annually.
Gold continued to be the standard into the late 19th century with gold rushes in the United States and Australia. It simply was turned into coins at an alarming rate. Common types of gold coins during this time included:
- Gold sovereign (England and Australia)
- Golden eagles (United States)
- Mark coins (Germany)
- Rouble coins (Russia)
- Crown coins (Austria)
- Florin coins (Hungary)
- Napoleon coins (France)
During World War I, gold coin production was stopped and gold coins were even recalled from citizens for their metal content. This makes many pre-1933 golden coins quite rare.
World War I marked the end of gold coinage being widely used as currency.
Do they increase in value?
As I’ve mentioned, the price of gold fluctuates greatly over time, and it can be hard to predict. I’m no expert in the gold market and what its price will do in the future. You can look at price charts to see how high the price has been and where it currently sits.
It’s an investors best guess as to whether they are getting gold for a good value that may appreciate in time.
However, gold coins with strong collector’s value can certainly be good investments. Some of these become more and more rare over time. When the price of gold soars, coins may be sold and melted, making the surviving specimens even more prized.
There’s no guarantee when it comes to investing in gold. All you can do is look for a good deal and work to maintain your coin’s condition to protect its collector’s value.
Where should you purchase golden coins?
When purchasing gold bullion, always buy from an official government mint rather than a private mint…
… Indeed, Private companies advertising collectible gold coins will eagerly sell you specimens that do not retain their value and may not even contain much actual gold. Please don’t fall for these.
When buying ancient or collector’s gold coins, follow the standard tips for purchasing from a trusted dealer. You’ll certainly want to make sure your gold coin is certified.
Examples of Famous gold coins …
Below few famous examples that you should know about:
- The King Edward III double florin is a gold coin that is over 675 years old. There are only three known to exist, making it one of the rarest coins in the world.
- A rare $20 1933 Double Eagle gold coin sold for over $7 million at auction in 2002, making it one of the most valuable coins ever sold.
- The first million-dollar coin was produced by Canada in 2007. It is made of 99.99% pure gold, is 20 inches wide, over 1 inch thick, and weighs 220 pounds (1 kg). One recently sold for over $4 million.
- In 2012, Australia minted its own behemoth gold coin weighing 1 ton. It is currently valued at over $60 million. It features Queen Elizabeth II on one side and, of course, a kangaroo on the other.
- The Umayyad gold dinar is nearly 1300 years old and one of only about twelve in existence. One sold in 2011 for over $6 million.
Final Thought: Why would you collect these Coins?
Some people collect gold coins for the same reason they collect other coins—the historical interest and because they simply love coins. Others collect them as a means of investment. And Some collect them for both reasons.
If you are looking into these as a means of investment, I’d recommend speaking with a financial or investment counselor. Gold bars or ingots may be a better choice for you if you are not interested in the collector’s value of coins.
Gold bars are created specifically for investment reasons and will not have the upcharges associated with coin minting.
The allure of gold is quite attractive for many collectors and can be a rewarding addition to the hobby.
Finally, I do believe that such an opportunity to collect golden coins is what will keep this activity alive for the many decades to come!
