The formation of gold placers is related to glaciers, which in old times heavily mined the rocks and veins by cutting broad gashes through them originating the canyons. In this way millions of tons of rocks were mined together with the gold bearing veins in them, and also the precious metals minutely diffused and scattered throughout their masses. After the glaciers, the rivers took up the work, deepened the canyons, broke up the boulders and sorted them depositing them along their banks and beds.

It is important to mention that of the several metals handled by nature jigging process many were dissolved and destroyed by several acids in the waters and iron salts percolating through the placer dumps after they had been laid down. With exception of a very hard minerals such as magnetite, diamond, garnets and rubies, other minerals remained in the placer, but gold and even gold-silver alloys, which were in the original vein, for placer gold are much purer and more valuable than in the original gold vein.

Probably, in some cases, the fine disseminated gold through the placer appears to have been acted upon certain salts such as iron compounds that were concentrated into large nuggets. Some nuggets are only waterworn pebbles of gold, brought direct from the vein; the result perhaps of concentration there of the contents of large masses of gold bearing pyrite is noted. Gold bearing nuggets of several sizes are found in placers. With the gold in placers, the present of black sands is common and they are composed of grains of pebbles of magnetic iron, relics of gold bearing pyrites. Being near in gravity to gold and typically associated with it, they are found in placers and a gold prospector in studying a bank of placer material up of sand, pebbles or boulders usually looks for a streak of black sand as a likely placer for gold. Considering the gravity of gold, a prospector is inclined to look for it more down on bed-rock than in the upper looser strata.

According to some geologists, ancient river beds as well as those of modern rivers may be found gold-bearing, rivers that have long ceased to flow, by reasons perhaps of change in the configuration of the deposit. in California and Australia many of these gold-bearing river beds have at a period not long distant been deluged and covered by lava, and the gold is extracted by tunneling beneath the lava sheet or by removing the gravel below. These are called deep leads and the ordinary uncovered gravels are known as shallow placers. Almost anywhere along ancient water courses nor far from mountains, a gold prospector by panning can get colors of gold, even on the pebbly wash covering the surfaces of large portions of plains or even on the tops of table lands that once were plains, over which broad rivers and glaciers and large bodies of water distributed their remains.