For over 2000 years cities and empires traded without using coins and there is no definitive theory as to why they were first produced.
The earliest coins were made in ancient kingdoms from Lydia (which is now to be found in modern Turkey and produced as a method of payment around the 6th or 5th century BCE. Coins came in different sizes and weights, each controlled to ensure their purity.
There were no inscriptions on these coins, instead the use of a stamped image indicated their weight and subsequent value which in turn acted as a state sanctioned guarantee of quality. After that, coins spread to city and states in the ancient Greek world. At a similar time coins were being made in China but they took on quite a different form….
References
http://www.britishmuseum.org/explore/themes/money/the_beginnings_of_coinage.aspx
http://www.ancient.eu/coinage/
http://www.ancient.eu/coinage/