Throughout history, legislation has played a major role in American coinage. Bullion coin history is vast and takes us through some of the most important parts of history, including the birth of the nation, the Civil War, two World Wars and unprecedented legislative acts that would shape the investment strategies of Americans everywhere.
Every coin and currency item we hold has a history and story behind it. All stories have a beginning, and the story of American coinage begins at the founding of the United States.
The Birth of Coinage and Currency – The Coinage Act of 1792
This first act passed on April 2, 1792, and created the United States dollar as the standard unit of money. The United States Mint was also established as the producer and maker of coinage for the United States. The Coinage Act of 1792 was important to separate the monetary system from European currency and coins, firmly establishing the United States as its own entity. The coinage act also ushered in the standard denominations we are familiar with today.
With this legislation came the need to shore up the metal content in every coin since the standards were different in the European system. For citizens who owned silver or gold, there was a dilemma on their hands. The first act did not adequately address the gold and silver owners’ usage of the metal, which set the stage for acts to come in future years.
Other important features of the Coinage Act of 1792 included:
- Establishing the bimetallic monetary system.
- Gold coins are minted in $10, $5 and $2.50 denominations.
- Silver coins are minted in quarter dollars, half dollars, and dollars.
- Cents and half cents are minted from copper.
Other Important American Coinage Legislation
- The Coin Act of 1834
This act was a major contributor to establishing the Gold Standard. Increasing the value of gold was a major turning point for American coinage. Prior to 1834, silver was more valuable and helpful to carry. As the roles reversed, gold became a more important precious metal to discover and buy. Silver was exported to Europe where it was traded at higher prices. - The Coin Act of 1849
Essentially, this act helped create newly minted gold coin denominations of $1 and $20. As more gold coins in various denominations were minted, the value of gold continued to outpace the value of silver. Much of this was due to the California Gold Rush in San Francisco. Gold value increased significantly, making it a truly coveted metal. - The Coin Act of 1857
The United States officially ended the status of all foreign coins as legal tender. This included any foreign gold or silver owned by citizens. Under the act, if a citizen had foreign coins, they could be exchanged or recoined by the Treasury. - The Coin Act of 1873
This coin act was perhaps the most controversial. It demonetized silver and firmly established the Gold Standard in full. The devaluation of silver caused an outcry from those who owned silver bullion. - The Coin Act of 1965
The Coin Act of 1965 impacted the coins we hold in our possession today. It effectively eliminated silver content from the dime and quarter. For the Half Dollar, the silver content was reduced from 90 percent to 40 percent. We may have Pre-1965 dimes and quarters in our possession because they are more commonly circulated.
These were important acts in history, but their history should never be undersold in our knowledge of American coinage. There are several other acts that helped shaped the history of currency and collecting as we know it today.
