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Related subjects: Currency

Background Information

SOS Children, which runs nearly 200 sos schools in the developing world, organised this selection. Child sponsorship helps children one by one

A selection of modern coins

A coin is a piece of hard material that is standardized in weight, is produced in large quantities in order to facilitate trade, and is used primarily as a medium of exchange or legal tender.

Coins are usually metal or a metallic material and sometimes made of synthetic materials, usually in the shape of a disc, and most often issued by a government. Coins are used as a form of money in transactions of various kinds, from the everyday circulation coins to the storage of large numbers of bullion coins. Presently, coins and banknotes make up currency, the cash forms of all modern money systems. Coins made for paying bills and general monetized use are usually used for lower-valued units, and banknotes for the higher values; also, in many money systems, the highest value coin made for circulation is worth less than the lowest-value note. In the last hundred years, the face value of circulation coins has usually been higher than the gross value of the metal used in making them; exceptions occurring when inflation causes the metal value to surpass the face value, causing the minting authority to change the composition and the old coins to begin to disappear from circulation (see Gresham's Law.) However, this has generally not been the case throughout the rest of history for circulation coins made of precious metals.

Exceptions to the rule of coin face-value being higher than content value also occur for some bullion coins made of silver or gold (and, rarely, other metals, such as platinum or palladium), intended for collectors or investors in precious metals. Examples of modern gold collector/investor coins include the American Gold Eagle minted by the United States, the Canadian Gold Maple Leaf minted by Canada, and the Krugerrand, minted by South Africa. The American Gold Eagle has a face value of US$50, and the Canadian Gold Maple Leaf coins also have nominal (purely symbolic) face values (e.g., C$50 for 1 oz.); but the Krugerrand does not.

Historically, a great number of coinage metals (including alloys) and other materials (e.g. Porcelain) have been used practically, artistically, and experimentally in the production of coins for circulation, collection, and metal investment, where bullion coins often serve as more convenient stores of assured metal quantity and purity than other bullion.

Coins have long been linked to the concept of money, as reflected by the fact that in some other languages the words "coin" and "currency" are synonymous. Fictional currencies may also bear the name coin (as such, an item may be said to be worth 123 coin or 123 coins).


The first coins developed in the context of Iron Age Anatolia and Archaic Greece around 600 BC. Coins spread rapidly in the 6th and 5th centuries BC, throughout Greece and Persia, and further to the Balkans and India. Standardized Roman currency was used throughout the Roman Empire. Important Roman gold and silver coins were continued into the Middle Ages (see Gold dinar, Solidus, Aureus, Denarius). Ancient and early medieval coins represented the value of the metal they were made of. The idea of fiat money first arose in medieval China, with the jiaozi paper money. Early paper money was introduced in Europe in the later Middle Ages, but coins continued to represent the value of the gold or silver they were made from throughout the Early Modern period. The penny was minted as a silver coin until the 17th century. The first copper pennies were minted in the United States in the 1790s. Silver content was reduced in many coins in the 19th century (use of billon), and the first base metal coins (e.g. nickel, cupronickel, aluminium bronze), representing values higher than the value of their metal, were minted beginning in the mid 19th century.

Bronze Age predecessors

An Oxhide ingot from Crete. Late Bronze Age metal ingots were given standard shapes, such as the shape of an "ox-hide", suggesting that they represented standardized values.

Coins were an evolution of "currency" systems of the Late Bronze Age, where standard-sized ingots, and tokens such as knife money, were used to represent value. In the late Chinese Bronze Age, standardized cast tokens were made, such as those discovered in a tomb near Anyang. These were replicas in bronze of earlier Chinese money, cowry shells, so they were named Bronze Shell. These, as well as later Chinese bronzes, were replicas of knives, spades, and hoes, but not "coins" in the narrow sense as they did not carry a mark or marks certifying them to be of a definite exchange value.

Iron Age

1/3rd stater from Lydia, 6th century BC.
Anatolian gold coin from 4th century BC Mysia.
Greek drachma of Aegina. Obverse: Land Chelone / Reverse: ΑΙΓ(INA) and dolphin. The oldest Aegina Chelone coins depicted sea turtles and were minted ca. 700-550 BC.

The earliest coins are mostly associated with Iron Age Anatolia, especially with the kingdom of Lydia. Early electrum coins were not standardized in weight, and in their earliest stage may have represented ceremonial objects, such as badges or medals, issued by priests. Many early Lydian and Greek coins were undoubtedly minted under the authority of private individuals and are thus more akin to tokens or badges than true coins, though because of their numbers it's evident that some were official state issues, with King Alyattes of Lydia being a frequently mentioned originator of coinage.

The first Lydian coins were made of electrum, a naturally occurring alloy of silver and gold that was further alloyed with added silver and copper. Most of the early Lydian coins include no writing, called a "legend" or "inscription", only an image of a symbolic animal. Therefore the dating of these coins relies primarily on archeological evidence, with the most commonly cited evidence coming from excavations at the Temple of Artemis at Ephesus, also called the Ephesian Artemision (which would later evolve into one of the Seven Wonders of the Ancient World). The fact that the oldest lion head coins were discovered in that temple, and the fact that they were not used in commerce, strengthens the scenario that these coins found there may have actually been badges or medals that were issued by the priests of the temple of Artemis, Anatolian Artemis being the Potnia Theron ("Mistress of Animals"), whose symbol was the lion.

A small percentage of early Lydian/Greek coins have a legend.

A famous early electrum coin, the most ancient inscribed coin at present known, is from nearby Caria. This coin has a Greek legend reading phaenos emi sema interpreted variously as "I am the badge of Phanes", or "I am the sign of light", or "I am the tomb of light", or "I am the tomb of Phanes". The coins of Phanes are known to be amongst the earliest of Greek coins, a hemihekte of the issue was found in the foundation deposit of the temple of Artemis at Ephesos (the oldest deposit of electrum coins discovered). One assumption is that Phanes was a wealthy merchant, another that this coin is associated with Apollo- Phanes and, due to the Deer, with Artemis (twin sister of the god of light Apollo-Phaneos). Although only seven Phanes type coins were discovered, it is also notable that 20% of all early electrum coins also have the lion of Artemist and the sun burst of Apollo-Phaneos. Alternatively, Phanes may have been the Halicarnassian mercenary of Amasis mentioned by Herodotus, who escaped to the court of Cambyses, and became his guide in the invasion of Egypt in the year B.C. 527 or 525. According to Herodotus, this Phanes was buried alive by a sandstorm, together with 50000 Persian soldiers, while trying to conquer the temple of Amun–Zeus in Egypt. The fact that the Greek word "Phanes" also means light (or lamp), and the word "sema" also means tomb makes this coin a famous and controversial one.

Another candidate for the site of the earliest coins is Aegina, where Chelone ("turtle") coins were minted ca. 700-550 BC, either by the local Aegina people or by Pheidon king of Argos (who first set the standards of weights and measures). In the Bibliothèque Nationale, Paris, there is a unique electrum stater of Aegina.^

Coins from Athens and Corinth appear soon later, from the late 6th century BC.

Classical Antiquity

Set of three roman aurei depicting the rulers of the Flavian dynasty. Top to bottom: Vespasian, Titus and Domitian. 69-96 AD.

Coinage followed Greek colonization and influence first around the Mediterranean and soon after to North Africa (including Egypt), Syria, Persia, and the Balkans.

Coins were minted in the Achaemenid Empire, including the gold darics and silver sigloi. and with the Achemenid conquest of Gandhara under Darius the Great c. 520 BC, the practice spread to the Indo-Gangetic Plain. The coins of this period were called Puranas, Karshapanas or Pana. These earliest Indian coins, however, are unlike those circulated in Persia, which were derived from the Greek/Anatolian type; they not disk-shaped but rather stamped bars of metal, suggesting that the innovation of stamped currency was added to a pre-existing form of token currency which had already been present in the the Mahajanapada kingdoms of the Indian Iron Age. Mahajanapadas that minted their own coins included Gandhara, Kuntala, Kuru, Panchala, Shakya, Surasena and Surashtra.

In China, early round coins appear in the 4th century BC.

The first Roman coins, which were crude, heavy cast bronzes, were issued ca. 289 BC.

Middle Ages

The first European coin to use Arabic numerals to date the year in which the coin was minted was the St. Gall silver Plappart of 1424.


A silver coin made during the reign of the Mughal Emperor Alamgir II.

As currency

Most coins presently are made of a base metal, and their value comes from their status as fiat money. This means that the value of the coin is decreed by government fiat (law), and thus is determined by the free market only inasmuch as national currencies are subjected to various types of foreign exchange markets in international trade. This causes such coins to be monetary tokens in the same sense that paper currency is, when the paper currency is not backed directly by metal, but rather by a government guarantee of international exchange of goods or services. Some have suggested that such coins not be considered to be "true coins" (see below). However, because fiat money is backed by government guarantee of a certain amount of goods and services, where the value of this is in turn determined by free market currency exchange rates, similar to the case for the international market exchange values which determines the value of metals which back commodity money, in practice there is very little economic difference between the two types of money (types of currencies).

Coins may be minted that have fiat values lower than the value of their component metals, but this is never done intentionally and initially for circulation coins, and happens only in due course later in the history of coin production due to inflation, as market values for the metal overtake the fiat declared face value of the coin. Examples of this phenomenon include the pre-1965 US dime, quarter, half dollar, and dollar, US nickel, and pre-1982 US penny. As a result of the increase in the value of copper, the United States greatly reduced the amount of copper in each penny. Since mid-1982, United States pennies are made of 97.5% zinc, coated with 2.5% copper. Extreme differences between fiat values and metal values of coins causes coins to be removed from circulation by illicit smelters interested in the value of their metal content. This is an example of Gresham's Law. In fact, the United States Mint, in anticipation of this practice, implemented new interim rules on December 14, 2006, subject to public comment for 30 days, which criminalized the melting and export of pennies and nickels. Violators can be punished with a fine of up to $10,000 and/or imprisoned for a maximum of five years.

As a collector's item

In terms of its value as a collector's item, a coin is generally made more or less valuable by its condition, specific historical significance, rarity, quality/beauty of the design and general popularity with collectors. If a coin is greatly lacking in all of these, it is unlikely to be worth much. Bullion coins are also valued based on these factors, but are largely valued based on the value of the gold or silver in them. Sometimes non-monetized bullion coins such as the Canadian Maple Leaf and the American Gold Eagle are minted with nominal face values less than the value of the metal in them, but as such coins are never intended for circulation, these value numbers are not market but fiat values.

Coin debasement

Throughout history, governments have been known to create more coinage than their supply of precious metals would allow. By replacing some fraction of a coin's precious metal content with a base metal (often copper or nickel), the intrinsic value of each individual coin was reduced (thereby "debasing" their money), allowing the coining authority to produce more coins than would otherwise be possible. Debasement sometimes occurs in order to make the coin harder and therefore less likely to be worn down as quickly. Debasement of money almost always leads to price inflation unless price controls are also instituted by the governing authority, in which case a black market will often arise.

The United States is unusual in that it has only slightly modified its coinage system (except for the images and symbols on the coins, which have changed a number of times) to accommodate two centuries of inflation. The one-cent coin has changed little since 1856 (though its composition was changed in 1982 to remove virtually all copper from the coin) and still remains in circulation, despite a greatly reduced purchasing power. On the other end of the spectrum, the largest coin in common circulation is 25 cents, a low value for the largest denomination coin compared to other countries. Recent increases in the prices of copper, nickel, and zinc, mean that both the US one- and five-cent coins are now worth more for their raw metal content than their face (fiat) value. In particular, copper one-cent pieces (those dated prior to 1982 and some 1982-dated coins) now contain about two cents worth of copper. Some denominations of circulating coins that were formerly minted in the United States are no longer made. These include coins with a face value of half a cent, two cents, three cents,and twenty cents. (The Half Dollar and Dollar coins are still produced, but mostly for vending machines and collectors.) The United States also used to coin the following denominations for circulation in gold: One dollar, $2.50, three dollars, five dollars, ten dollars, and twenty dollars. In addition, cents were originally slightly larger than the modern quarter and weighed nearly half an ounce, while five cent coins were smaller than a dime and made of a silver alloy. Dollars were also much larger and weighed approximately an ounce. One dollar gold coins are no longer produced and rarely used. The U.S. also has bullion and commemorative coins with the following denominations: 50¢, $1, $5, $10, $25, $50, and $100.

Other uses

Some convicted criminals from the British Isles who were sentenced to transportation to Australia in the 18th and 19th centuries used coins to leave messages of remembrance to loved ones left behind in Britain. The coins were defaced, smoothed and inscribed, either by stippling or engraving, with sometimes touching words of loss. These coins were called "convict love tokens" or "leaden hearts". A number of these tokens are in the collection of the National Museum of Australia.

Features of modern coins

1884 United States Trade Dollar

Circulating coins commonly suffered from "shaving" or "clipping", by which persons would cut off small amounts of precious metal from their edges to form new coins. Unmilled British sterling silver coins were sometimes reduced to almost half their minted weight. This form of debasement in Tudor England was commented on by Sir Thomas Gresham, whose name was later attached to Gresham's Law. The monarch would have to periodically recall circulating coins, paying only bullion value of the silver, and reminting them. This, also known as recoinage, is a long and difficult process that was done only occasionally. Many coins have milled or reeded edges, originally designed to make it easier to detect clipping.

Traditionally, the side of a coin carrying a bust of a monarch or other authority, or a national emblem, is called the obverse, or colloquially, heads; see also List of people on coins. The other side, which carries the denomination, is called the reverse, or colloquially, tails. However, the rule is violated in some cases. Another rule is that the side carrying the year of minting is the obverse, although some Chinese coins, most Canadian coins, the pre-2008 British 20p coin, and all Japanese coins, are exceptions.

In cases where a correctly oriented coin is flipped vertically to show the other side correctly oriented, the coin is said to have coin orientation. In cases where a coin is flipped horizontally to show the other side, it is said to have medallic orientation. While coins of the United States Dollar are coin orientated, those of the Euro and British Pound are medallic.

Bi-metallic coins are sometimes used for higher values and for commemorative purposes. In the 1990s, France used a tri-metallic coin. Common circulating examples include the €1, €2, British £2 and Canadian $2.

The exergue is the space on a coin beneath the main design, often used to show the coin's date, although it is sometimes left blank or containing a mint mark, privy mark, or some other decorative or informative design feature. Many coins do not have an exergue at all, especially those with few or no legends, such as the Victorian bun penny.

3 Russian Rubles coin minted in 2008.

Not all coins are round. The Australian 50 cent coin, for example, has twelve flat sides. A twist on it is wavy edges, found in the two dollar and the twenty cent coins of Hong Kong and the 10 cent coins of Bahamas. Some coins have also been issued in the shape of a square, such as the 15 cent coin of the Bahamas. During the 1970s, Swazi coins were minted in several shapes, including squares, polygons, and wavy edged circles with 8 and 12 waves.

Some other coins, like the British Fifty pence coin and the Canadian Loonie, have an odd number of sides, with the edges rounded off. This way the coin has a constant diameter, recognisable by vending machines whichever direction it is inserted.

A triangular coin with a face value of five pounds (produced to commemorate the 2007/2008 Tutankhamun exhibition at The O2 Arena) was commissioned by the Isle of Man, it became legal tender on 6 December 2007. Other triangular coins issued earlier include: Cabinda coin, Bermuda coin, 2 Dollar Cook Islands 1992 triangular coin, Uganda Millennium Coin and Polish Sterling-Silver 10-Zloty Coin.

Guitar-shaped coins were once issued in Somalia. Poland once issued a fan-shaped 10 złoty coin and the 2002 $10 coin from Nauru, was Europe-shaped.

Some mediaeval coins, called bracteates, were so thin they were struck on only one side.

The Royal Canadian Mint is now able to produce holographic-effect gold and silver coinage. However this procedure is not limited to only bullion or commemorative coinage. The 500 yen coin from Japan, was subject to a massive amount of counterfeiting. The Japanese government in response produced a circulatory coin with a holographic image.

The Royal Canadian Mint has also released several coins that are coloured, the first of which was in commemoration of Remembrance Day. The subject was a coloured poppy on the reverse of a 25 cent piece.

For a list of many pure metallic elements and their alloys which have been used in actual circulation coins and for trial experiments, see coinage metals.



Coins are popularly used as a sort of two-sided die; in order to choose between two options with a random possibility, one choice will be labeled heads and the other tails, and a coin will be flipped or tossed to see whether the heads or tails side comes up on top – see coin flipping. Mathematically, this is known as a Bernoulli trial: a fair coin is defined to have the probability of heads (in the parlance of Bernoulli trials, a "success") of exactly 0.5. Coins are sometimes falsified to make one side weigh more, in order to simulate a fair type of coin which is actually not fair. Such a coin is said to be weighted.


Coins can also be spun on a flat surface such as a table. This results in the following phenomenon: as the coin falls over and rolls on its edge, it spins faster and faster (formally, the precession rate of the symmetry axis of the coin, i.e., the axis passing from one face of the coin to the other) before coming to an abrupt stop. This is mathematically modeled as a finite-time singularity – the precession rate is accelerating to infinity, before it suddenly stops, and has been studied using high speed photography and devices such as Euler's Disk. The slowing down is predominantly caused by rolling friction (air resistance is minor), and the singularity (divergence of the precession rate) can be modeled as a power law with exponent approximately −1/3.

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