It is time to trace back the current of the colonial era and explore how American history encouraged the design, issue, and process of US banknotes. The continental Congress in rebellion against the British, introduced the first American dollar in 1775, which was a national paper currency created to meet military expenses. The first American dollar was issued in 1914. Want to know what is the origin of the American dollar? Read on to know more about early American currency.
History of U.S. Currency Timeline
Who made the first US dollar? The history of the US dollar traced back to more than 240 years since the issuance of Continental Currency in 1775. The United States Congress designed the United States dollar which was introduced as the country’s standard currency on April 2, 1792.
The term ‘dollar’ was commonly used during the colonial period and it referred to the eight-real coin(also called Spanish dollar) used across the Spanish.
When Was the US Dollar Created?
- A. 1900
- B. 1914
- C. 1910
- D. 1912
Who made the first US dollar? Following the American Revolutionary War started in 1775, the Continental Congress started issuing paper currency which was called Continentals or Continental currency. Continental currency was introduced in dollars from $1⁄6 to $80.
In the Revolutionary period, Congress introduced $241,552,780 in Continental currency.
After the US Constitution was approved, Congress introduced the “Mint Act” on April 2, 1792. It introduced the coinage system of the US and the dollar was approved as the principal currency. By implementing this act, the US became the world’s first country to adopt the decimal system for currency.
The first US coins came out in 1793 at the Philadelphia Mint and showed to Martha Washington.
The US government did not introduce paper money until 1861. But the government did introduce “Treasury notes” intermittently in the period of the financial crisis, including the War of 1812, the Mexican War in 1846, and the Panic in 1857.
From1793 to 1861, around1600 private banks were allowed to print and circulate their own paper current under state charters.
Over time, 7000 varieties of state bank currency were circulated, and each bank had a unique design.
What was the first paper money printed by congress called with the onset of the Civil War, the US government needed money to finance the war hence it passed the Act of July 17, 1861, which permitted the Treasury Department to print and circulate paper currency.
These paper currencies were known as “demand notes.” It was also often referred to as “greenbacks.” Congress stopped issuing the demand notes and started circulating the United States notes in 1861 which were known as the legal tender notes.
As per Congressional Acts of 1878 and 1886, five unique issues of silver certificates were invented, starting from $1 to $1,000 dollar notes. This treasury involved the exchange of silver certificates for silver dollars due to the weight and size of the silver coins which made them less popular.
Later, the series of silver certificates was circulated in 1923. But the final series of modern silver certificates issued were the series 1957B/1935H $1 notes, 1953B $10 notes, and the Series 1953C $5 notes.
From 1863 to 1929, the US government allowed thousands of banks to circulate their own currency under the National Banks Acts of 1863 and 1864. These currencies were referred to as “national banknotes.” It was previously known as the “state banknotes,” they were designed on paper approved by the US government and kept the same basic design.
Congress established the Federal Reserve Act, introducing the nation’s Federal Reserve System in 1913. In this Act, the Federal Reserve Banks authorized to issue Federal Reserve Banknotes. In 1914, the Federal Reserve Banks started circulating Federal Reserve notes which were the only money still being used at present by the Bureau of Engraving and Printing.