A history of gold coins in the U.S.
Long appreciated for its beauty, rarity and practicality, gold is the ultimate coining material. It’s true that even rarer metals can be made into bullion coins, and cheaper, more common substances make up our circulating coinage. But gold and alloys of gold have been there from the beginning and show no signs of going away.
In fact, gold coins have enjoyed a renaissance of sorts over the last 30 to 40 years–with recent years witnessing a major upsurge in the precious metals market worldwide.
A variety of gold coin products have come out of the U.S. Mint during this “renaissance”. The U.S. has produced gold coinage from almost the start of production in Philadelphia, and except for the “prohibition” era of 1933-1974 when private ownership of gold was illegal, American gold coins have been an important part of the economy and the hobby.
So today, I wanted to offer a brief overview of the history of gold coins in the United States.
The English colonies in America often faced coin shortages and so used many different kinds of commodity money in their dealings with the natives and each other. What kind of commodity was used differed according to region and local economy.
Still, hard coin was frequently necessary, especially when dealing with foreign merchants. For this reason many foreign coins circulated as legal tender during the colonial period, and any history of gold coins in America must at least mention this fact. Among the gold foreign coins in circulation at the time were English guineas, gold ducats from international trading powerhouse the Netherlands, louis d’ors from France, and, most famously, the Spanish gold doubloon.
All forms of foreign currency were finally demonetized in the United States by the Coinage Act of 1857. This happened for two reasons: it took that long for the Treasury Department to feel confident that American coinage needs were met or could be met by the Mint, and the depreciation of Spanish and Mexican silver. From this point on, the only legal gold coins were the ones being produced in Philadelphia, Dahlonega, New Orleans, and San Francisco.
The First U.S. Gold Coins
The Coinage Act of 1792 was the first law to authorize the production of gold coins in the United States of America. Specifically, it mandated the weight and purity of three new coins and denominations: the eagle ($10), the half eagle ($5), and the quarter eagle ($2.50). The half eagle was first off the line in 1795, and the eagle followed later that year. Quarter eagles were first issued in 1796.
These denominations were still being issued as late as 1933 (more on that in a few). Each one went through a series of design changes until they settled on the Liberty Head varieties of the Victorian era. These types are increasingly popular with collectors today.