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Colonial Currency Paper Money

The system of currency in colonial America was not a uniform one. Many foreign coins circulated as viable currency, especially Spanish dollars. The colonies officially used the pound system, but even between individual colonies, the value of the pound was not fixed.

These problems were exacerbated by Great Britain's policies concerning paper currency printed in the colonies. Although allowed until 1751, Britain eventually revoked colonial currency's ability to be used as legal tender for private merchants in New England. Britain also forbade New England colonies from printing more bills, but further legislation in 1773 allowed the colonies to print paper currency once again. With the advent of the Revolutionary War, the colonies issued temporary fiat currency payable upon victory over the British. This move was unsuccessfully duplicated by the Confederate States of American during the Civil War.

Colonial currency is a challenging medium for collecting. Relatively few bills survive to this day, and even those that do survive vary tremendously in their desirability. Some feature signatures from noteworthy historical figures, while others have significant images or legends. Still others have passed through the hands of powerful families and have achieved a pedigree by virtue of previous owners.

Quick Facts

  • The common use of the Spanish dollar in the colonies is seen as a driving factor behind the creation of the American dollar rather than an American pound
  • The Smithsonian Institute has successfully assembled a 13-colony set featuring one bill from each colony. Many of the bills included in the collection include signatures by men who also signed the Declaration of Independence or the Constitution
  • A five-shilling bill dated August 18, 1775 sold at auction for $70,500 in 2013. The bill features Paul Revere holding a sword and is professionally graded as Choice New 63 PPQ, an outstanding grade

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