See Abraham and Melchizedek: Scribal Activity of Second Temple Times in Genesis 14 and Psalm 110 by Gard Granerød (2010, De Gruyter), which gives a very thorough and original analysis of Psalm 110 and its reception history. Essentially the messianic reading of the psalm is only the third interpretation in its reception; prior to this was the historicizing interpretation (which created the character of Melchizedek who was then interpolated into Genesis 14, on the basis of taking the “my lord” of 110:1 as referring to Abraham). The oldest understanding of the psalm, as argued by Granerød, was a monarchic, royal one, with the poem essentially a prophecy construing the king (“my lord” in v. 1) as having permanent priestly duties (cf. 2 Samuel 6:13-18, 8:18, 24:25, 1 Kings 3:4, 15, 8:5, 14, 12:33). The context is possibly a dispute between the hereditary priesthood and the Davidic royal house (compare the story of Uzziah in 2 Chronicles 26:16–21), with the prophet delivering an oracle of Yahweh (in v. 1, 5 the prophet is calling the king “my lord” and gives Yahweh’s oracle in v. 1b, 2b-3, and 4b) assuring the king’s claim to priestly responsibilities. Granerød also gives a linguistic analysis of verse 4 (which has a difficult to understand phrase על דברתי) and concludes it probably meant something like “You are a priest forever because of me, righteous king” or “You are a priest forever, for my sake my king is just”.

The JPS similarly renders the verse “You are a priest forever, a rightful king by my decree”. Only in later historicizing interpretation did מלכי צדק come to be viewed as a name, motivating the Melchizedek episode in Genesis 14, and the LXX not only followed this interpretation but also rendered על דברתי as κατὰ τὴν τάξιν, which gave rise to the idea of Melchizedek as establishing a non-hereditary divinely elected priesthood. 1 Maccabees 14:41 may allude to Psalm 110 on this reading, with the Hasmonean Simon (who had no hereditary right to the priesthood) being confirmed as leader and high priest forever (ἀρχιερέα εἰς τὸν αἰῶνα). The messianic interpretation then arose in the Hasmonean era, possibly as a counter to the Hasmonean application of the psalm to themselves. If the psalm referred not to the king in general but to an individual priest-king Melchizedek from the distant past who remains a priest forever, then this must refer to a heavenly figure. So 4QShirShabb and 11QMelch posit Melchizedek as a priest in the heavenly assembly, who would free God’s people from the power of Belial, who would be the “anointed one” of Daniel 9:25.