Archaeological finds from excavations in the temple of Artemis in Ephesus determine the beginning of coinage in the last years of the 7th century BC According to the ancient sources, the reputed inventors of coinage are Pheidon -the king of Argos- Damodice of Cyme -wife of king Midas- Erichthonius and Lycus of Athens, the Lydians and the Naxians. The Lydians however are considered as the real inventors of coinage, who used for the first minting a precious metal, the electrum. This was an alloy of gold and silver, found in the sand of the river Pactolus, which rose in the mountain Tmolus and flowed through the capital Sardis, in Lydia. Herodotus reports that the Lydians were also the first who minted coins of gold and silver. He probably refers to subsequent bimetallic mintings by Croesus. In Greece, the first coins were made of silver that was obtained from Laurium mines (Attica) and from Northern Greece.

It is generally accepted that the most ancient mint in the Greek mainland was situated on the island of Aegina. Researches indicate that the island's coins date from the years after 550 BC. Their appearance can not be associated with the tradition which refers to the king of Argos Pheidon as the one who minted the first coins in Greece and which dates back to the beginning of the 7th century BC (Herodotus, Historia 6.127.10-12).

Initially, scholars maintained that coinage had an economic function, being a stable measurement for the needs of trade. It was absolutely normal to consider that its emergence -which served that purpose precisely- attested the development of transactions in the Archaic period and the beginning of a monetary economy.

Later however, it was ascertained that the above opinion was not that simple. On the contrary it presented an intricacy that made its re-evaluation necessary. The first information concerning the transition from simple exchange of goods to the use of money, is found in Aristotle's texts. In the relevant extracts he seems to attribute a moral interpretation to the role of coinage, which is directly associated with the set of values in the Archaic communities.

Apart from that, we see that during the first mintings in several cities the low denominations are missing. Moreover, where there are high denominations, as in the cities of Sicily, coins circulated mainly in the region where they were minted. This could be interpreted as a sign that -at least in the beginning- coinage was not used for facilitating trade, domestic or overseas. The only cases where there seems to be a relation -be it indirect- between trade and coinage are those of Athens and the coastal cities of Thrace and Macedonia. These cities exported coinage to the East and to Egypt, though not as currency, but as valuable objects made of silver.

The invention and spread of coinage should be set in a wider frame of social relations and values developed during the Archaic period. Laws had started to be codified, in order to stop their arbitrary interpretation. In such a climate, coinage started to have a legal basis.