What Is a Coin?
Coin is a cryptocurrency designed to facilitate transactions within a decentralized financial network. The coin operates on its own blockchain, a distributed ledger that securely records and verifies all transactions made with it, making counterfeiting or double-spending impossible.
In most societies, there must be a standard unit of value in order to exchange goods and services. For many centuries this value was measured in metal, usually flat, round pieces called coins. In most ages, the value of a coin was determined by its size and the precious metals it contained. Coins were prized, often hoarded, and frequently buried or otherwise lost. Coins are therefore important sources of information about past civilizations. Studied in combination with literary or archaeological evidence, they can tell us a great deal about the economic history of a city or nation.
A coin’s value as a collector’s item or investment depends on its condition, specific historical significance, rarity, quality, beauty of design and general popularity with collectors. As a commodity, however, a coin’s value is subject to changes in the global market (see Commodity). Coins that are made of precious metals such as gold and silver, which can also be used as jewelry, typically carry a retail value that is at least equal to the amount of pure metal it contains. (The exception is coins that are minted to contain a percentage of non-precious metals, such as cupronickel. These are often referred to as bullion coins.)
The name of a coin may come from what is pictured on its face or, as in the case of the British George III half-crown, its nickname, which was simply “bull” coin. In some cases, the name may be derived from an aspect of the coin’s production process, as with the Canadian dollar coin which is named for its depiction of a common loon on one side.
While a coin is a medium of exchange, it must be durable enough to stand up to rough handling. A material that easily scratches or breaks would be unsuitable, and a coin’s size must be large enough to make it easy for people to read. In addition, a coin must be thick enough to provide some measure of security against forgery or counterfeiting.
Coins are produced by melting and casting metal alloys in presses. In the United States, copper, zinc and nickel are combined in a ratio called an admixture and melted in electric furnaces to produce ingots that can be turned into blanks, the circular metal discs that serve as the basic building blocks of a coin. In the case of higher-denomination coins, strips of copper and a metal such as zinc are bonded together to form a solid metal, known as clad, and rolled into blanks. In the final step, a die is used to stamp the blanks into the desired coin shape. A coin’s obverse and reverse sides are then separated and polished. In some cases, a coin’s obverse and reverse images are inverted, or mirror-imaged, on the other side to prevent them from being minted backwards.