What Is Coin Currency?
Coin currency comes in the form of coins with a value, generally determined by their precious metal content. Some coins are also minted with a specific historic, rare or collectible significance. A coin’s value as a collector’s item or as an investment is influenced by the condition of the coin, its rarity and quality, as well as its beauty.
Historically, a coin’s value was based on the amount of precious metal it contained; gold and silver were the most common. These materials were expensive, though, and the use of them in coins induced manipulations like clipping coins to remove the precious metal. This caused a general debasement of the money supply, which often led to price inflation unless the governing authority also instituted price controls.
In the eighteenth century, coins of gold and silver reached a high standard of technical and aesthetic quality. Coins could be made with a specific weight and purity, marked to identify the authority that guaranteed their contents. This was a major step up from lumps of electrum (an alloy of silver and gold) that had previously been used as money.
As the industrial revolution took hold, coin production increased to meet the demand for currency in the United States and around the world. The Industrial Revolution, in turn, spurred the development of the railroad system, which allowed people to travel long distances more easily and quickly. This, in turn, helped expand commerce and trade.
Modern coinage uses copper, nickel, silver and gold. Some coins have a special coating, such as chromium, which protects the coin from corrosion. The copper and nickel in a dollar, for example, help make it stronger than the silver in a $10 bill. The nickel also helps to give a bill its distinctive green color, which makes it easier to tell one from another in the dark.
The coining process is very complex, and the production of any single type of coin can take a year or more to complete. Some coins, such as the two-cent piece, have to be rolled and stamped several times to produce enough of them for circulation.
Coins are usually round, although they can be in other shapes as well. The 50-cent coin of Australia, for instance, has twelve flat sides. Similarly, some coins have wavy edges, such as the $2 and 20-cent coins of Hong Kong and the 10-cent coin of the Bahamas. Some coins are even shaped as symbols of their country or region, such as the guitar-shaped Somali 10 shillings and Poland’s fan-shaped 10 zloty.
Most circulating coins are dated and contain an image or symbol of the issuing nation or region. They may also have a motto, such as “In God We Trust” on the American two-cent piece from 1864. The space in the middle of a coin, called the exergue, is often left blank or contains a mint mark or privy mark. Rare or valuable coins are sometimes inscribed with a date or other information as well.