Currencies of the United States

Currencies of the United States
Country	United States
Image title 1	A Federal Reserve Note
Iso code	USD
Iso number	840
Inflation rate	3.4% (March 2024)
Inflation source date	Bureau of Labor Statistics
Unit	dollar
Frequently used banknotes	$1, $5, $10, $20, $50, $100
Frequently used coins	1¢, 5¢, 10¢, 25¢
Issuing authority	Federal Reserve
Issuing authority website	federalreserve.gov
Mint	United States Mint
Mint website	usmint.gov

Currencies of the United States have evolved from a disjointed system of foreign and colonial money into a unified, federally controlled monetary standard centered on the United States dollar. The modern system is managed by the Federal Reserve and the United States Department of the Treasury, issuing Federal Reserve Notes and coins that serve as the world's primary reserve currency. This financial architecture is underpinned by federal law, most notably the Federal Reserve Act of 1913, which established the nation's central banking system.

History of U.S. currency

Prior to the American Revolution, the Thirteen Colonies used a mixture of Spanish dollars, British pound sterling, and locally issued colonial scrip. The financial chaos of the Revolutionary War led to the hyperinflation of the Continental currency, prompting the Founding Fathers to embed coinage powers in the United States Constitution. The Coinage Act of 1792, signed by President George Washington, created the United States Mint and established the dollar, pegged to silver and gold, as the national unit. The 19th century was marked by periods of Free Silver agitation, the use of United States Notes (Greenbacks) during the American Civil War, and the Panic of 1907, which ultimately led to major monetary reform.

Federal Reserve notes

Federal Reserve Notes, first issued in 1914 following the Federal Reserve Act, constitute the paper currency in circulation today. These notes are obligations of both the Federal Reserve and the United States government, produced by the Bureau of Engraving and Printing. The current series features portraits of prominent American figures such as George Washington on the $1 bill, Abraham Lincoln on the $5 bill, and Benjamin Franklin on the $100 bill. While historically backed by precious metals, Federal Reserve notes have been fiat currency since the Nixon shock and the end of the Bretton Woods system in 1971.

Coins of the United States

Coins are produced by the United States Mint, with facilities including the Philadelphia Mint and the Denver Mint. Circulating coinage includes the penny (featuring Abraham Lincoln), the nickel (Thomas Jefferson), the dime (Franklin D. Roosevelt), and the quarter, which has featured George Washington and, since 1999, rotating designs through programs like the 50 State Quarters. Higher-value coins such as the half dollar and dollar coins (honoring Sacagawea or Presidents) are minted but rarely used in daily commerce.

Obsolete and discontinued denominations

Numerous denominations once issued by the Treasury are no longer produced. These include high-value notes like the $500 bill (William McKinley), the $1,000 bill (Grover Cleveland), and even a $100,000 Gold Certificate featuring Woodrow Wilson, used only for intra-government transactions. In coinage, the half cent, large cent, two-cent piece, three-cent piece, Half dime, and twenty-cent piece have all been discontinued.

Legal tender and currency law

The status of Legal tender in the United States is governed by federal statute, primarily the Coinage Act of 1965. All Federal Reserve Notes and United States coinage are legal tender for all debts, public and private. Private businesses are generally free to set their own acceptance policies, but currency cannot be refused for payment of a debt. The Legal Tender Cases, a series of rulings by the Supreme Court of the United States following the American Civil War, affirmed the constitutionality of paper money as legal tender. The United States Secret Service, originally part of the Treasury, was founded to combat counterfeiting.

Design and security features

Modern U.S. currency incorporates sophisticated anti-counterfeiting features developed by the Bureau of Engraving and Printing and the Federal Reserve. These include a embedded security thread, color-shifting ink, Microprinting, a watermark, and EURion constellation patterns. The most recent redesigns, such as the 2004 series and the current 2017 series of notes, feature large, off-center portraits and enhanced security. Historical designs, like those overseen by Treasury officials such as Salmon P. Chase, have evolved significantly, with the last major redesign of the $1 bill occurring in 1963.

Category:Economy of the United States Category:Currencies of the United States Category:United States dollar