The United States dollar (sign: $; code: USD; also abbreviated US$), also referred to as the U.S. dollar or American dollar, is the official currency
of the United States of America and its overseas territories. It is divided into 100 smaller units called cents.
The U.S. dollar is the currency most used in international transactions and is one of the world's dominant reserve currencies. Several countries use it as their official currency, and in many others it is the de facto currency. It is also used as the sole currency in two British Overseas Territories, the British Virgin Islands and the Turks and Caicos islands.
Summary information about United States dollar
- ISO 4217 Code:
- Currency sign:
- United States, El Salvador, Panama, Ecuador
- 1 cent, 5 cents, 10 cents, 25 cents, 50 cents, 1 United States dollar
- 1 United States dollar, 2 Unites States dollars, 5 United States dollars, 10 United States dollars, 20 United States dollars, 50 United States dollars, 100 United States dollars
- Central bank:
- United States Mint
The United States was a British colony until July 4, 1776 when the United States declared its independence from Great Britain.
The best way to understand the United States colonial monetary system is to realize that being a British colony, Pounds and Shillings were the units of account, but because Britain restricted the flow of coins to the American colonies, Spanish Dollars became the medium of exchange.
As a British colony, the United States followed the British monetary system. Money, as a medium of exchange, was always scarce in the colonial United States. Individual colonies wanted to issue their own currency to alleviate this scarcity, but the British government wanted to retain full control over the monetary system. Each colony issued its own currency, and each colonys currency was independent of the currency issued by other colonies.
Because of the lack of domestic currency, foreign coins were used throughout the United States into the 1800s. Wampun was accepted as legal tender until 1670, although it was used by the Indians until the late nineteenth century. Beaver and deer skins as well as tobacco were also used for currency. French, Spanish, Portuguese and English coins were all used in the United States with the Spanish Milled Dollar (XMSD), which was equal to about 6 Shillings, being the most common. The Shilling was the primary unit of account in the United States, and in general it took 1.33 Continental Shillings (XCCS) to get a British Shilling.
The dollar became the basis of the monetary system in the United States after the US declared its independence. The Continental Congress issued Paper Continental Dollars (USC) to fund the war, as did most of the individual states. The Continental Congress also issued some coins. The Continental Dollar was originally worth about 4.5 British Shillings, but it depreciated during the war until it became virtually worthless, leading to the saying, Not worth a Continental. By the end of the war it took 1000 Continental Dollars to get a silver Mexican Dollar.
When Alexander Hamilton introduced the United States Dollar (USD) on April 4, 1792, it had a weight slightly less than that of the Mexican Silver Dollar. The United States had a bimetallic system with the ratio of gold to silver set at 15 to 1. Individual states were forbidden from issuing their own currency by the Constitution, but the Federal government and private banks were allowed to issue their own banknotes. The Act of February 9, 1793 regulated foreign coins, making the gold coins of Britain, Portugal, France and Spain legal tender in the United States.
During the Civil War, the United States went off the gold standard, and issued paper currency (USP) that floated in value against gold. Between 1865 and 1878, the US was split into two currency regions with paper money largely used east of the Rockies, and gold and silver on the west coast. The paper dollars were not convertible into gold at parity until January 1, 1879.
The United States left the Gold Standard on April 20, 1933. During World War II, the United States issued special currency for the North African and Pacific theaters that were not legal tender in the United States. The Pacific banknotes were referred to as Hawaiian Dollars (USH) and were equal to 20 Japanese Military Yen. Currency restrictions on the Hawaiian Dollars were repealed on October 21, 1944.
Although the United States government had the exclusive right to issue coins, private banks issued banknotes within the United States until the Civil War. During the Civil War, the US government passed a 10% tax on privately issued banknotes, effectively ending their issuance. The US government began issuing banknotes during the Civil War and continued to issue banknotes until the last United States Note was placed in circulation on January 21, 1971. Between 1863 and 1935, private banks registered with the Comptroller of the Currency were allowed to issue banknotes that were backed by Government Bonds. During that period of time over 14,000 banks issued banknotes. In 1935, the Federal Government called in the bonds that backed the notes, and their issuance was discontinued. In 1913, the Federal Reserve was established, and since 1971 it have been the sole note-issuing authority in the United States.
The ISO set up additional codes for Same Day Funds (USS) in the United States Dollar. Same day funds are immediately available for transfer today, or for withdrawal in cash, subject to settlement of the transaction through the payment mechanism used. Next Day Funds (USN) are immediately available for transfer in like funds, and, subject to settlement, available in the next business day for same day funds transfer or withdrawal in cash.
Colonies and states issued their own currency until they were forbidden to do so by the United States constitution. Values of paper currencies could be converted into either Spanish Milled Dollars or British Pounds
Sterling or Shillings. One Spanish Milled Dollar was equal to 4 Shillings, 6 Pence Sterling. Most colonies issued currency in both Shillings and Dollars with the equivalent values printed on the notes. Some colonies currencies (New York, Pennsylvania and Virginia) had low rates of depreciation before the Revolutionary war, while other currencies (Massachusetts and South Carolina) depreciated rapidly. Because exchange rates
differed for each colonys currency, a history of each is provided.
Connecticuts currency was modeled after Massachusetts currency. Connecticut first issued paper money in 1709 with 1.33 Proclamation (Old Tenor) Connecticut Shillings (CCTO) equal to 1 Shilling Sterling, or 6 Shillings to the Spanish Milled Dollar. Connecticuts paper money steadily depreciated, and in 1740, Connecticut issued New Tenor bills (CTCN), equal to 3.5 Old Tenor (Proclamation) Shillings. The Connecticut Shilling was further reformed in 1755 when Lawful Money Treasury Notes were issued to redeem all prior issues at the rate of 1 Colonial Shilling (CCTC) equal to 7.33 Old Tenor Shillings or 2.10 New Tenor Shillings. The Connecticut Shilling was initially fixed at the rate of 1.33 Shillings Sterling, but the Paper Shilling (CCTS) steadily depreciated during the Revolutionary War. After the war, a Connecticut Dollar (CCTD) was issued with 1 Dollar equal to 1000 Paper Shillings.
Delawares currency was modeled after Pennsylvanias currency. Its currency was first issued in 1723 at the rate of 1.33 Proclamation Shillings (CDEC) to the Shilling Sterling, though the Delaware notes traded at a discount in Pennsylvania. Delaware Continental Paper Shillings (CDES) depreciated during the Revolutionary War and were replaced by the Delaware Dollar (CDED) in 1783.
Georgia first emitted currency in 1735, with Georgia Shillings (GCAC) at par with Shillings Sterling. Georgia was able to maintain parity with Shilling Sterling until the Revolutionary War when the Continental Paper Shilling (GCAS) depreciated along with other currencies. The Georgia Dollar (GCAD) replaced the depreciated Shilling in 1783.
Maryland first emitted paper money at Proclamation Money Rates (GMDP) in 1733 with 1.33 Maryland Shillings equal to 1 British Shilling. New Bills (CMDN) were issued in 1751, and the old Shilling notes were redeemed at the rate of 1.25 Proclamation Shillings to 1 New Colonial Shilling. Maryland also issued Continental Shillings (CMDS) during the war, which gradually depreciated. Beginning in 1780, Maryland issued both Black money (CMDB), printed in black ink, at par with the British Shilling and Red money (CMDR), printed in red ink, with 1.67 Maryland Shillings equal to 1 British Shilling. The Maryland Dollar (CMDD) replaced the Shilling after the war.
The first American coins were issued under the authority of the Massachusetts Bay Colony in 1652. Massachusetts introduced a shilling (CMAB) in 1690 with 1.33 Massachusetts Bay Shillings equal to 1 British Shilling. The Shilling steadily depreciated, and a Proclamation (Old Tenor) Shilling was introduced in 1704. It was followed by both Middle Tenor Shillings (CMAM) and New Tenor Shillings (CMAN) in 1741 with 1 New Tenor Shilling equal to 1.33 Middle Tenor Shillings or 4 Old Tenor Shillings. The Massachusetts currency was stabilized in 1749 with a Colonial Shilling (CMAC) equal to 10 Old Tenor Shillings. The Massachusetts Shilling (CMAS) depreciated during the Revolutionary War and was replaced by the Massachusetts Dollar (CMAD) in 1783.
New Hampshire first issued currency (CNHP) at Lawful (Proclamation) rates of 1.33 New Hampshire Shillings equal to 1 British Shilling in 1709. Depreciation of the currency followed, and in 1742, New Tenor (CNHN) notes were introduced at the rate of 1 New Tenor note for 4 Old Tenor notes. The Lawful Shilling (CNHL), payable in Sterling, was introduced in 1755, and equal to 1/3 New Tenor Shilling and 13 1/3 Old Tenor Shillings. A new New Hampshire Shilling (CNHC) was introduced in 1763, again at par with the British Shilling, and equal to 1.33 Lawful Shillings, 6.67 New Tenor Shillings and 26.67 Old Tenor Shillings. The Continental Hampshire Shilling (CNHS) depreciated during the Revolutionary War, and was replaced by the New Hampshire Dollar (CNHD) in 1783.
New Jersey issued its currency at Proclamation Rates (CNJP) of 1.33 New Jersey Shillings equal to 1 British Shilling in 1709. A slightly depreciated New Jersey Shilling (CNJC) was introduced in 1746 at the rate of 1.67 Colonial Shillings equal to 1 British Shilling. The Continental New Jersey Shilling (CNJS) depreciated during the Revolutionary War. New Jersey introduced a New Shilling (CNJN) in 1781, but it quickly depreciated and was replaced by the New Jersey Dollar (CNJD) in 1783. The New Shilling was redeemed at the rate of 3 to 1.
New York first issued Shilling paper currency (CNYP) in 1709 at the rate of 1.5 New York Shillings to 1 British Shilling. The New York Shilling depreciated a little before the Revolutionary War, but never enough to require a currency reform. The Continental New York Shilling (CNYS) depreciated during the Revolutionary War and was replaced by the New York Dollar (CNYD) in 1783.
North Carolina first issued Shilling currency at Proclamation rates (CNCP) of 1.33 North Carolina Shillings to 1 British Shilling. The Shilling steadily depreciated, and a New Tenor Shilling (CNCN) was introduced in 1748, equal to 7.5 Old Tenor Shillings. The North Carolina Continental Shilling (CNCS) depreciated during the Revolutionary War and was replaced by the North Carolina York Dollar (CNCD) in 1783.
Pennsylvania issued its first currency at Proclamation rates of 1.33 Pennsylvania Shilling (CPAP) equal to 1 British Shilling in 1723. The Pennsylvania Shilling depreciated a little before the Revolutionary War, but never enough to require a currency reform. The Pennsylvania Continental Shilling (CPAS) depreciated during the Revolutionary War and was replaced by the Pennsylvania Dollar (CPAD) in 1783.
Rhode Islands currency generally traded at par with Massachusetts currency and depreciated at the same rate as the Massachusetts Shilling. Rhode Island first issued its currency in 1710 at Proclamation rates of 1.33 Rhode Island Proclamation Shillings (CRHP) to 1 British Shilling. The currencies of both Rhode Island and Massachusetts steadily depreciated, and in 1740, New Tenor bills (CRHN) were issued at the rate of 1 New Tenor bill to 40 Old Tenor Bills. Rhode Island began redeeming its bills in 1763, and by 1771, all bills had been redeemed in Lawful Money with 1 Lawful Colonial Shilling (CRHC) equal to 6.67 New Tenor Shillings and 26.67 Old Tenor Shillings. The Rhode Island Continental Shilling (CRHS) depreciated during the Revolutionary War and was replaced by the Rhode Island Dollar (CRHD) in 1783.
South Carolina first issued paper currency in 1703 at the rate of 1.5 South Carolina Shillings (CSCP) to 1 British Shilling. New issues of South Carolina Shillings were issued at a discount to previous issues in 1716, 1719, 1723, 1731 and 1740. All previous issues were redeemed in 1748 at the rate of 4.67 Proclamation Shillings to Lawful Shillings (CSCC). The South Carolina Continental Shilling (CSCS) depreciated during the Revolutionary War and was replaced by the South Carolina Dollar (CSCD) in 1783.
Vermont did not issue any paper currency until after the Revolutionary War when it issued Lawful Money at the rate of 1.33 Vermont Shillings equal to 1 British Shilling in 1781 as an assertion of its statehood.
Virginia issued its first paper currency in 1755, and since it carried a 5% premium over Proclamation rates (CVAP), it traded at 1.3 Virginia Shillings to 1 British Shilling. The Virginia Continental Shilling (CVAS) depreciated during the Revolutionary War and was replaced by the Virginia Dollar (CVAD) in 1783.
Puerto Rico was a Spanish colony from 1508 until December 10, 1898 when it was ceded from Spain to the United States. It became a United States territory on March 2, 1917, and achieved Commonwealth status on July 25, 1952. Puerto Rico used Spanish Pesetas as its currency until 1898 when the United States Dollar was introduced.
The United States Dollar is also used in Pacific Islands that are still the territory of the United States.
The value of gold or silver contained in the dollar was then converted into relative value in the economy for the buying and selling of goods. This allowed the value of things to remain fairly constant over time, except for the influx and outflux of gold and silver in the nation's economy.
The early currency of the USA did not exhibit faces of presidents, as is the custom now. In fact, George Washington was against having his face on the currency, a practice he compared to the policies of European monarchs. The currency as we know it today did not get the faces they currently have until after the early 20th century; before that "heads" side of coinage used profile faces and striding, seated, and standing figures from Greek and Roman mythology and composite native Americans. The last coins to be converted to profiles of historic Americans were the dime (1946) and the Dollar (1971).
For articles on the currencies of the colonies and states, see Connecticut pound, Delaware pound, Georgia pound, Maryland pound, Massachusetts pound, New Hampshire pound, New Jersey pound, New York pound, North Carolina pound, Pennsylvania pound, Rhode Island pound, South Carolina pound and Virginia pound.
Official United States coins have been produced every year from 1792 to the present.
Technically, all these coins are still legal tender at face value, though some are far more valuable today for their numismatic value, and for gold and silver coins, their precious metal value. From 1965 to 1970 the Kennedy half dollar was the only circulating coin with any silver content though the Mint still makes what it calls Silver Proof sets for collectors.
In addition, an experimental $4.00 (Stella) coin was also minted, but never placed into circulation and is properly considered to be a pattern rather than an actual coin denomination.
The $50 coin mentioned was only produced in 1915 for the Panama-Pacific International Exposition (1915) celebrating the opening of the Panama Canal. Only 1,128 were made, 645 of which were octagonal; this remains the only U.S. coin that was not round as well as the largest and heaviest U.S. coin ever.
From 1934 to present the only denominations produced for circulation have been the familiar penny, nickel, dime, quarter, half dollar and dollar. The nickel is the only coin still in use today that is essentially unchanged (except in its design) from its original version. Every year since 1866, the nickel has been 75% copper and 25% nickel, except for 4 years during World War II when nickel was needed for the war.
The United States Mint
produces Proof Sets specifically for collectors and speculators. Silver Proofs tend to be the standard designs but with the dime, quarter, half dollar, and in some cases the dollar having silver content. Another type of proof set is the Presidential Dollar Proof Set where four special $1 coins are minted each featuring a president.
- 2007 had George Washington, John Adams, Thomas Jefferson, and James Madison;
- 2008 had James Monroe, John Quincy Adams, Andrew Jackson, and Martin Van Buren;
- 2009 had William Henry Harrison, John Tyler, James K. Polk, and Zachary Taylor;
- 2010 had Millard Fillmore, Franklin Pierce, James Buchanan, and Abraham Lincoln;
- 2011 had Andrew Johnson, Ulysses S. Grant, Rutherford B. Hayes, and James A. Garfield.
The U.S. Constitution provides that Congress shall have the power to "borrow money on the credit of the United States". Congress has exercised that power by authorizing Federal Reserve Banks to issue Federal Reserve Notes. Those notes are "obligations of the United States" and "shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank." Federal Reserve Notes are designated by law as "legal tender" for the payment of debts. Congress has also authorized the issuance of more than 10 other types of banknotes, including the United States Note and the Federal Reserve Bank Note. The Federal Reserve Note is the only type that remains in circulation since the 1970s.
Currently printed denominations are $1, $2, $5, $10, $20, $50, and $100. Notes above the $100 denomination stopped being printed in 1946 and were officially withdrawn from circulation in 1969. These notes were used primarily in inter-bank transactions or by organized crime; it was the latter usage that prompted President Richard Nixon to issue an executive order in 1969 halting their use. With the advent of electronic banking, they became less necessary. Notes in denominations of $500, $1,000, $5,000, $10,000, and $100,000 were all produced at one time; see large denomination bills in U.S. currency for details. These notes are now collector's items and are worth more than their face value to collectors.
Though still predominantly green, post-2004 series incorporate other colors to better distinguish different denominations. As a result of a 2008 decision in an accessibility lawsuit filed by the American Council of the Blind, the Bureau of Engraving and Printing is planning to implement a raised tactile feature in the next redesign of each note, except the $1 and the version of the $100 bill already in process. It also plans larger, higher-contrast numerals, more color differences, and distribution of currency readers to assist the visually impaired during the transition period.
USD banknotes pictures gallery
|1 United States dollar|
|Banknote of 1 United States dollar has dimensions 156×66 mm and main colors are trolley grey, taupe gray, camouflage green, pale spring bud, grullo, almond and desert sand. The banknote of 1 United States dollar was issued in 2006.|
Obverse side of the 1 United States dollar is showing the portrait of George Washington (February 22, 1732 – December 14, 1799), the First President of the United States of America, painted by Gilbert Stuart.
Reverse side of the 1 United States dollar is showing the Great Seal of the United States featuring the all-seeing Eye of Providence, an American eagle and a pyramid, which symbolizes the United States.
|2 United States dollars|
|Banknote of 2 United States dollars has dimensions 156×66 mm and main colors are khaki, dark sea green, camouflage green, asparagus, feldgrau, champagne, pale spring bud, blond and pastel gray. The banknote of 2 United States dollars was issued in 2009.|
Obverse side of the 2 United States dollars is showing homas Jefferson (April 13, 1743 – July 4, 1826), the third President (1801-1809) of the United States of America, the principal author of the United States Declaration of Independence.
Reverse side of the 2 United States dollars is showing the Engraved modified reproduction of the painting "Signing of the Declaration of Independence" in 1776 (painting by John Trumbull).
|5 United States dollars|
|Banknote of 5 United States dollars has dimensions 157×66 mm and main colors are dark gray, taupe gray, grullo, pearl, camouflage green, grullo, pale spring bud, timberwolf and linen. The banknote of 5 United States dollars was issued in 2006.|
Obverse side of the 5 United States dollars is showing the portrait of Abraham Lincoln (February 12, 1809 – April 15, 1865), the 16th President (in office March 4, 1861 – April 15, 1865) of the United States of America, one of the greatest of all U.S. Presidents, became the first American president to be assassinated.
Reverse side of the 5 United States dollars is showing the Lincoln Memorial, located on the National Mall in Washington,
D.C. (dedicated on May 30, 1922), designed by Architect Henry Bacon.
|10 United States dollars|
|Banknote of 10 United States dollars has dimensions 157×66 mm and main colors are wheat, desert sand, desert sand, wheat, pale gold, khaki, grullo, almond, wenge, liver, rifle green and camouflage green. The banknote of 10 United States dollars was issued in 2006.|
Obverse side of the 10 United States dollars is showing the Statue of Liberty Torch (replaced in 1986); Alexander Hamilton (January 11, 1757 – July 12, 1804), the first United States Secretary of the Treasury and the words "We the People" from the United States Constitution.
Reverse side of the 10 United States dollars is showing United States Treasury in Washington, District of Columbia.
|20 United States dollars|
|Banknote of 20 United States dollars has dimensions 156×67 mm and main colors are khaki, papaya whip, bisque, xanadu, viridian, pale silver, desert sand, timberwolf, pastel gray, platinum and champagne. The banknote of 20 United States dollars was issued in 2006.|
Obverse side of the 20 United States dollars is showing the portrait of Andrew Jackson.
Reverse side of the 20 United States dollars is showing the White House.
|50 United States dollars|
|Banknote of 50 United States dollars has dimensions 156×66 mm and main colors are pale silver, cinereous, sand, beaver, camouflage green, pale , taupe, khaki and pastel gray. The banknote of 50 United States dollars was issued in 2006.|
Obverse side of the 50 United States dollars is showing the portrait of Ulysses S. Grant.
Reverse side of the 50 United States dollars is showing the United States Capitol building.
|100 United States dollars|
|Banknote of 100 United States dollars has dimensions 156×67 mm and main colors are outer space, davy’s grey, manatee, taupe gray, pale silver, timberwolf, pastel gray and timberwolf. The banknote of 100 United States dollars was issued in 2006.|
Obverse side of the 100 United States dollars is showing the portrait of Benjamin Franklin Benjamin Franklin (January 17, 1706 – April 17, 1790), which was one of the Founding Fathers of the United States, a noted polymath, Franklin was a leading author, printer, political theorist, politician, postmaster, scientist, musician, inventor, satirist, civic activist, statesman and diplomat.
Reverse side of the 100 United States dollars is showing the Independence Hall.
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