I am not sure where the term came from but I first heard in in NYC in the 80s it was usually a cheap 38 revolver that had a gray or black past, sometimes the handles where wrapped in tape. They were meant to be temporary guns that could be tossed into the dark shadows of the night.
Years ago I traded for one it was an old beat up S&W it sat around for a while then I saw one at a gun shop one one day for $500. So I thought "wow" maybe it is worth money, looked it up and ended up selling it to the shop for $350.
Much more then I got t for.