I've seen several English translations for "PhD", but seems to me that it did not originate from England. Who introduced the term, what did it originally stand for and where did it originate from? I'm curious where anyone has traced out this history.
The chicken and egg problem was simple: you don't have to have a PhD to certify someone as an expert in some field of knowledge if you are already a world-leading authority in that field of knowledge. The faculty at the Humboldt University at that time were all already widely known experts, and so they were able to credential other as experts.
Term Ph.D. is an abbreviation from Philosophy Doctor (also referred to as doctor of philosophy), an English language variant of the Latin phrase Doctor Philosophiae. Historically, the linguistic roots of the title can be traced back to early meaning of modern English language words doctor and philosophy. The former comes from Latin word for (license to) teach (see this Wikipedia article), while the former comes from Greek phrase for "love of wisdom", implying general knowledge acquisition. While I am not aware of who introduced the term "doctor of philosophy" (and, most likely, it cannot be proved accurately), if I can make an uneducated guess, it most likely has been introduced some time in medieval Europe. Interesting additional linguistic and historical support of the above-mentioned information can be found in this related discussion on StackExchange.
In the older English universities there had been for hundreds of years the senior doctoral degrees (Doctor of Science, Doctor of Letters, etc) that were broadly equivalent to habilitation in the universities of continental Europe. They were awarded in recognition of a very great mass of work, much more than a mere PhD dissertation. The holders of those degrees did not, in their opinion, NEED PhD degrees to decide to confer them on other people. When I was a post-graduate student at Cambridge 50 years ago there was a certain inverted snobbery amongst some of the teachers: I was taught Galois theory by Mr X FRS. Presumably he did not feel the need to prove himself by bothering with any postgraduate degree, and what is more, his senior colleagues presumably thought he did not need to do so either.