The Trade dollar was a coin produced by the U.S. Mint from 1873 through 1878 to facilitate trade with East Asian nations like China and Japan.
It was created out of a need to compete with the Mexican 8 Reale or Peso, which had gained a place of notoriety in Asian commerce. The American silver dollar of the time was 7.5 grains (0.49 grams) lighter than the Mexican silver Peso and the weight difference made them unpopular in East Asia.
This put American merchants in the position of having to purchase Mexican or Spanish coins for use in trade.
Like the Morgan Silver Dollar, the Trade dollar was authorized by the Coinage Act of 1873. Unlike the Morgan Dollar, the Trade dollar was intended for circulation outside the United States. However, Trade dollars were also considered legal tender until their status was changed by Congress in 1876.
Design of the Trade Dollar
Numerous designs were considered for the Trade dollar, and in 1872, a series of pattern coins were produced in anticipation of the 1873 Coinage Act. While the pattern coins of 1872 were made into 1873, their classification shifted from ‘commercial dollar’ to ‘trade dollar’ by the time the Coinage Act was made law.
Mint officials tasked an engraving and jewelry firm, Bailey Banks & Biddle to craft designs that they could compare to those already created by William Barber. It was decided that Liberty should be included in the design facing left, since the coins were intended for use in the East.
Eventually, an obverse featuring Liberty seated on a bale of merchandise, holding a scroll with the word ‘Liberty’ was chosen. The reverse depicted a bald eagle clutching three arrows in its right talons and an olive branch in its left talons, the opposite of most U.S. coins of the era.
A set of six patterns was sold to the public by the U.S. Mint in limited qualities. Four patterns included versions of the chosen obverse and two patterns displayed portraits of Liberty.
Production of the Trade Dollar
In 1873, dies were produced to strike the Trade dollar, which were first struck during a ceremony on July 11 of that year. 40,000 Trade dollars were issued in the first release on July 14, 1873.
Mint officials and others issued complaints about the quality of the strikes, especially the high relief areas of the design in 1874. Barber made changes to the design and the new dies were employed in 1875.
Circulation strikes of the Trade dollar ended in 1878 but proof varieties were struck until the final 979 Trade dollar proofs were minted in 1883. In 1908, ten proofs bearing 1884 dates and five proofs with 1885 dates were discovered but these were not listed in any official record.
How Much Silver is in a Trade Dollar?
In order to compete with the heavier Mexican peso, the Trade dollar had slightly higher than average silver content for U.S. silver dollars.
Trade dollars were produced with 420 grains (27.22 grams) of silver, which differed from the 412.5 grains (26.73 grams) of silver that most silver dollars of the time employed.
What are Trade Coins?
Trade coins are coins that are minted by a sovereign government for use outside the territory. They have government backing but may not be considered legal tender in the issuing nation. Their primary purpose as export goods is to buy goods from other nations.
The U.S. Trade dollar was issued to compete with Mexican silver pesos in East Asia as well as in South America, in nations with currency based on the silver standard.
Another notable example of a trade coin is the 1780 Maria Theresa thaler, which found popularity and buying power in East Africa.
Today, U.S. Trade dollars are popular among collectors and numismatists for their unique design, historical significance, and value.