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A touchstone is a piece of hard dark stone such as jasper, slate, or basalt which is used in the assaying process to test the purity of metals. The use of such stones was once quite widespread; although less common today, touchstones are still occasionally seen in assaying offices, and some people keep them around as interesting curios. It is also possible to see examples of historic touchstones, some of which are quite old, on display in museums.
To use a touchstone, someone would take a piece of the metal being tested and rub it against the touchstone. The metals most frequently tested with a touchstone are silver and gold, as these metals are classically soft and they have a high value which serves as an incentive to alloy them with cheaper metals. Once a streak to be tested has been laid down, a “testing pencil” of a known alloy is used to apply a second streak for comparison.
In addition to comparing the physical differences between the streaks, most assayers also use acidic solutions to dissolve impurities in the samples, which can reveal the trace of a cheap metal alloy. Touchstones are typically stored with an assortment of test pencils and acids for the purpose of testing, and several companies continue to produce supplies for using touchstones.
The practice of using a touchstone appears to have arisen in Greece around 500 BCE. The introduction of the touchstone to Greek society radically changed the Greek economic system, creating a real value for coined money by allowing people to actually test it for purity. As a result, the term “touchstone” began to acquire wider implications, which is why you may hear people referring to a means of judgment or measurement as a “touchstone.”
You don't have to be interested in assaying metals to be intrigued by a touchstone. Some scientific stores and mineralogy companies sell touchstone kits, which allow people to test their own samples. If you do acquire such a kit, make sure to supervise younger users, as the acids involved can be dangerous. It is also a good idea to store the acids in a cool dry place well out of the reach of curious children and pets.