Colonial Money: The early days

Colonial and post-Revolutionary currency had many stages of development during the colonial and post-Revolutionary history of the United States. The U.S. mint wasn’t able to make enough of them though and the use of foreign coins like the Spanish dollar were widely used. Sometimes colonial goverments issued paper money and the British parliment passed currency acts in 1751, 1764, and in 1773 that regulated colonial paper money.

During the American Revolution as states became indepenet of Great Britian it freed them from the British monetary regulations and the Continental Congress began issuing paper money to pay for military expenses. Unfortunately both state and Continental currency depreciated rapidly and became practically worthless at the end of the war. This was caused by the government printing too much paper money.

The three most common Colonial currency used was specie (coins) , paper money and commodity money. Commodity money was used to purchase goods such as tobacco , animal pelts , and food. Cash in the colonies was denominated in either pounds, shillings, and pence. There was no standard though. A Massachusetss pound was not equivalent to a Pennsylvania pound sterling. This resulted in the use of Spanish or Portugeuse money. The Spanish dollar was so prevalent in the newly created United States , it led to the United states being denominated in dollars rather than the British pound.

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