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This 3-Cent Bill Is Legal Tender in the United States

(Photo: US Post Office)

In a fascinating article at io9, Esther Ingils-Arkell tells us about United States fractional currency. During the American Civil War, the Trent Affair almost drew the UK into declaring war on the United States. This would almost certainly have resulted in a Confederate victory. Thankfully, Union diplomats were able to sooth British anger. But the war scare resulted in popular hoarding of metallic currency.

It was necessary to print out money in a hurry, so the Treasury released paper bills with designated values of fractions of a dollar, such as the 3-cent bill pictured above:

To put a lid on the chaos, the United States Treasury issued postal currency. These were, essentially, “small change,” and they could be exchanged for real money as long as the amount of postal currency being exchanged was five dollars or less. The ability to conduct everyday transactions with the confidence that these special stamps could be exchanged for bills stabilized the situation, but it was a stop-gap measure. To prevent forgery, the Treasury started making fractional currency, in denominations of 3, 5, 10, 15, 25, and 50 cents. Each was roughly the size of six modern-day postage stamps. This currency stayed in circulation for a decade and a half. It was only in 1876 that it started getting replaced with coins again.

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