American Numismatic Society
American Numismatic Society



Drachmas, Doubloons and Dollars: The History of Money

Early America

Introduction

North America's first European settlers often traded by barter, using corn, tobacco, and other goods as currency. During the 17th and 18th centuries, coins were often hard to come by in the British colonies, and royal authority was generally inattentive to the economic needs of its North American possessions. While Massachusetts did strike coins in the late 17th century, most of the money in circulation at the time of the Revolution was either Spanish or British. The pressing need for currency meant that people often used counterfeit coins or small-denomination private issues. Colonial governments also printed their own paper notes.

The Articles of Confederation that governed the relationship among the states allowed each one to issue its own coinage. Between 1776 and 1788, when the Constitution was ratified, both the states and the federal government produced coins, either as test patterns or for circulation. After 1788, the right to issue coins was reserved for the federal government, and the U.S. Mint finally began operation in 1792.

The early coinage of the independent United States is fascinating for what it says about the formation of the new nation, and coin design even drew the attention of the Founding Fathers. Benjamin Franklin designed a coin that exhorted Americans to "Mind Your Business," which here means to keep one's attention on one's work. President George Washington rejected coins bearing his portrait on the grounds that they were tyrannical. Instead, U.S. coins first showed a personification of Liberty, and this word still appears on all new coins issued by the U.S. Mint.