The powerful role of Gold in our history

Fascinating lessons for the future of Gold!

Gold’s integral relationship with our culture is still evolving and the history of gold is as fascinating as the role it plays in our world economy today. As the mining industry evolves with a new generation of technologies, it is instructive to look to the past for an understanding of how gold has impacted cultures.

“The quantity of gold they have is endless” — Marco Polo

It was inevitable that our collective ancestors first came into contact with gold as reflective yellow nuggets scattered throughout their environment. Gold can probably lay claim to being the first metal that ancient civilizations engaged with and it holds a unique place in our human psyche. Looking for some of the oldest human interactions with gold scientists have identified pieces of natural gold amongst the debris in caves used by Palaeolithic Man over 40,000 years ago.

Gold’s periodic symbol Au comes from the Latin word aurum which in turn was derived from the name for the goddess of dawn, Aurora. The relationship between gold and gods has always been intrinsic and in ancient Egypt, gold was known as the “flesh of the gods”. Since the beginning gold has been collected and dedicated to the supernatural.

Because it is comparatively dense at 10.18 troy ounces/in cubed, gold is still collected today using the ancient techniques of gold panning. The origins of using water to extract gold from placer deposits were probably born in pre-recorded history but records of this form of gold mining can be traced back at least to ancient Roman times. Throughout history, gold has held an allure that never seems to dim or tarnish.

The oldest examples of golden artefacts are found at one of the world’s key prehistoric archaeological sites, the Varna Necropolis in Bulgaria. The treasures at Varna date from between 4,600 BC and 4,200 BC and interestingly it was in graves that contained no skeletons that the largest volume of gold artefacts was discovered.

Although the majority of the site is still unexcavated more than three thousand pieces have been found, totalling over six kilograms of gold. This is almost $300,000 in golden offerings. In the singular case of grave-43, more gold was found there than has been found throughout the rest of the world for that epoch. Today this treasure is said to be the oldest gold of mankind.

Varna may hold the title as the oldest gold, the topic of buried golden treasure always brings to mind the tomb of the boy pharaoh Tutankhamun which when excavated in 1922 revealed gold artefacts that still mesmerize us today. Tutankhamun’s innermost coffin was constructed of pure gold and weighed 110.4 kilograms. Though its value is priceless that amount of gold would be worth almost $5.2 million at today’s spot prices. Pharaohs were considered by ancient Egyptians to be living gods on earth, worthy of nothing less than the noblest metal, gold.

Tutankhamun was young at the time of his death and did not have a chance to impact Egyptian culture in a significant manner. If such an audacious treasure was used to bury a relatively obscure pharaoh what wondrous golden art was plundered by tomb raiders from the burial chambers of great pharaohs such as Ramesses the Great or Thutmose III? Throughout its dynastic periods, Egypt continued to consume large quantities of gold.

It is also in ancient Egypt that we find the earliest uses of gold for health purposes. Over 5,000 years ago in Alexandria gold was ingested during physical, mental and spiritual purification rituals. In many regards, the medicinal use of gold was seminal in the foundation of alchemy. Alexandrian alchemists developed a potion of liquid gold whose mystical properties were said to cure disease and restore youth. Exactly like today, Egyptian dentists favoured gold for dental work as it can be easily shaped, is non-toxic and durable.

Mesoamerican cultures also revered gold and like the Egyptians, the noble metal was associated with their gods. It is interesting that similar to the Egyptian “flesh of the gods”, Mesoamerican gold also had a sacred yet physical name: “excrement of the gods”. Although it appears that goldsmithing developed later in Mesoamerica the quality of work was extraordinary. Most gold was used for personal adornment of the elite, although legends of entire gardens wrought of gold still speak to us from the past.

In the 1500s gold acquisition was a primary force that drove European exploration of the American continents. The desire to attain gold fuelled the actions of adventurers, colonists, conquerors and opportunists. When Hernán Cortés arrived in Mexico during 1519 it was rumours of gold that obsessed him. Upon occupying Tenochtitlan and imprisoning the Aztec king Montezuma II, Mesoamerican gold was smelted into bullion and transported to Spain. Only a very few of the priceless Mesoamerican artworks ever arrived in Europe intact.

Later when Francisco Pizarro arrived in Incan Peru he ambushed the Incan ruler Atahualpa and held him hostage for an enormous ransom. In a desperate bid to gain his freedom, Atahualpa paid handsomely. Two rooms were filled with silver and another large room filled with gold. The rooms were stacked high with precious metal but in the end, even that could not purchase freedom for Atahualpa or his kingdom

Because gold is so intricately woven through the tapestry of our history it is valuable to look to the past to understand the present. What we see in gold’s chequered history is an intrinsic store of value that transcends the ages. In one glance we also see incredible expressions of human creativity that clash directly with human suffrage. These are our lessons from the past and it is important that we incorporate them moving into the future.

One of the biggest issues associated with gold is exploitation. Unless carefully regulated gold mining can create problems. Some of the best regulations we have currently are in developed countries such as the US. Undertaking gold mining in the US requires continuously meeting strong and evolving regulatory requirements.

Accountability is another core issue associated with the gold market. From the mine to the ring accounting for gold is a tricky business. A new epoch of accountability in gold markets is now being heralded in the form of blockchain technologies. The accountability delivered by the blockchain has never been seen before in the history of gold. It has the potential to bring unimaginable changes to the mining sector as market forces demand enhanced accessibility and increased accountability.

The blockchain will allow physical bullion to reside in a single safe and security tokens to be issued for portions of that bullion. These tokens can then be ceaselessly traded globally for greater liquidity and convenience. The digital security tokens have additional security features and can be swapped directly for physical metal.

Gold’s past is as fascinating as its present or future. However, gold is more wonderful and more perplexing than other metals. There is no known substance that can destroy gold, it can be dissolved but remains intact in its golden state. When gold is consumed it passes through the body unscathed. This is perhaps where the Mesoamerican name for gold was derived from.

The history of gold may be the stuff of legends but that legendary gold still exists physically. If you own gold jewellery perhaps some of it was part of an ancient treasure trove or spent time in an Egyptian mummy. With the opaque accountability sometimes associated with gold, we’ll never know for sure.

Goldman Sachs is holding to its recent prediction that the value of gold will rise from a current spot price of $1,400 to $1600 over the next year. If this occurs that rise in prices could spur wider adoption of blockchain technologies across the industry, delivering greater accountability and value for consumers in the form of bullion-backed security tokens.

For further information on Canamex please visit our website or email info@canamexgold.com.