What is Coin Currency?

What is Coin Currency?

Coin currency is usually made of metal, although coins have also been made from other materials including leather, cloth, card, and paper. Coins are generally small and round, containing a small amount of precious metal or an alloy to represent value. Throughout history, coins have been prized and hoarded, sometimes even buried for safekeeping. The study of ancient coins reveals a wide range of information, including chronology and economic history. The distribution of coins reflects the wealth and power of cities and states, and may help define the physical extent of their territorial dominion.

Most people probably don’t think much about how coins make their way into wallets, cash registers and bank lobbies. But Federal Reserve banks and commercial banks do, all the time. These institutions order currencies from the U.S. Mint to distribute to their customers, who use it to buy goods and services.

The Fed’s website (Off-site) has a page dedicated to the currency lifecycle, with links to videos that explain how the process works. The site also includes a list of FAQs, with answers to questions that frequently come up.

During the COVID-19 pandemic, the flow of coins through the economy slowed down. Dimes gathered dust on dressers, and quarters languished in drawers rather than dropping into change sorters at banks or into washing machine coin slides at laundromats. The slowed pace of circulation meant that there weren’t enough coins available to meet the nation’s needs. Fortunately, the supply of coins is now back up to where it was before the pandemic struck.

Some denominations of circulating coins that were once made in the United States are no longer produced, including coins with a face value of one cent, two cents and three cents. One cent coins originally weighed almost half an ounce and were slightly larger than a modern quarter. They were also more valuable for their raw metal content than their “fiat” or symbolic value, which is now equal to a penny.

As prices of copper, nickel and zinc rose during the 1980s, many of America’s one-cent coins were worth more for their raw metal content than their face value. The same was true for a handful of other copper coins, such as the 1982-dated ones. The rising cost of copper, nickel and zinc prompted the Mint to reduce the percentage of copper in one-cent coins.

In addition, the heaviness of these coins was reduced by changing the thickness of their metals and adding more silver to the mix. In the end, only about half of the original one-cent pieces remained in circulation.

If you have a bunch of coins lying around, you can give them to kids to play with or give them to teachers for math lessons. Credit unions and some large banks still take rolled coins for deposit or exchange, but fees may apply for nonmembers. You can also bring them to a local Federal Reserve Bank, which will exchange them for cash without charge, as well as provide you with a record of the total amount.