Silver certificate is a form of legal tender that is made of paper currency. They were issued by the U.S. government in 1878. These certificates were eventually withdrawn in 1964. They can now be redeemed in cash for their face values, and not in actual silver.
Understanding Silver Certificates
Silver certificates were created in order to enable an investor to purchase silver without the need to own the commodity. These certificates represented an amount of silver bullion that was purchased or held by an investor. They were considered payable to the bearer on demand.
The silver certificate notes’ first release was larger than the later releases. They were roughly the same size as the U.S. paper currency currently in circulation. The larger certificates were available in denominations from $1 to $1,000. While the smaller ones were mainly available in lower denominations. These certificates featured portraits by notable Americans such as George Washington, Abraham Lincoln and Ulysses Grant.
The U.S. Treasury Secretary declared that silver certificates could no longer be redeemed for silver dollars in March 1964. Soon after, they were stopped being printed by the government.
The Silver Certificate’s History
The U.S. stopped making silver currency in 1806, but gold and silver coins could still be used as legal tender until 1861. The United States used a silver standard before the release of the silver certificates. Many Americans had accumulated silver bullion as a form of wealth. They could then convert it into legal tender coins. You could also own coins made of gold.
The 1873 Coinage Act abolished individuals’ right to have their silver converted into silver coins. Bankers and western mining companies wanted the return to the two-metal system. Many Americans were opposed to a fixed supply paper currency in the late 1880s because they feared that money would run out.
Public distrust was fueled by Western interest. They knew that an unlimited supply of currency would result in higher prices. This they saw as a benefit, and not as inflationary. In 1863, severe depression and inflation had marked the boundaries between Northeastern industrialists who preferred currency limitations and Midwestern and Southern farmers who saw currency limits as limiting their ability to charge higher for their crops.
Some supporters argued that farmers would be able to pay back their debts by having higher prices. The main issue was whether to use silver or gold to support the U.S. currency. The white house decided that the gold backers won and that the discussion was over. The USD adopted the gold-standard, which ended bimetallism and demonetized silver.
The Bland-Allison Act of 1878 allowed people to deposit silver coins at U.S. banks. Treasury to exchange certificates that were more convenient to carry.
Collectible Silver Certificates
Some silver certificates have a higher value than their face values. A variety of factors affect the exact value of any specific silver certificate, including its rarity and condition. These certificates are attractive because of their collectability as well as the nostalgia they hold.
Both currency collectors as well as history buffs continue to love silver certificates. These certificates are a great historical artifact that can transport the holder back in time to an era when there were many important and interesting events taking place in the country. This is also an example of the changes that took place in the currency system during this period.