This month’s coin highlight focuses on the longest-lived gold coin that was circulated in the United States—the $10 Liberty Gold Eagle. It was first struck in 1795 and was produced regularly until 1933, when Franklin D. Roosevelt broke the gold standard, and began melting a lot of these coins down for government purposes. Not only was the $10 Gold Eagle the longest-running gold denomination, but the $10 Liberty design was used for nearly 70 years!
The eagle is a base-unit of denomination issued only for gold coinage by the U.S. Mint, based on the original values designated by the Coinage Act of 1792. Since 1933, when citizens were forced to turn their gold coins (which only approximately 25% of them actually did), the eagle denomination has become irrelevant to circulating coinage.
The eagle was the largest of the four main decimal base-units of denomination used for circulating coinage in the United States prior to 1933. These four main base-units of denomination were the cent, the dime, the dollar, and the eagle. The eagle base-unit of denomination served as the basis of the gold quarter-eagle (US$ 2.50), the gold half-eagle (US $5), the eagle (US $10), and the double-eagle coins (US $20).
Gold eagles were issued for circulation by the U.S. Mint from 1795–1933, half eagles from 1795–1929, quarter eagles from 1796–1929, and double eagles from 1850–1933, with the occasional production gap for each denomination. Originally, the purity of all circulating gold coins in the U.S. was eleven twelfths pure gold (the same 22 karats level as English crown gold) and one twelfth alloy. Under U.S. law, the alloy was composed only of silver and copper, with silver limited to no more than half of the alloy by weight. Thus, U.S. gold coins had 22/24 (22 kt or 91.667%) pure gold, at most 1/24 (0–4.167%) silver, with the remaining 1 to 2/24ths (4.167–8.333%) being copper.
The very first $10 gold eagles were struck in 1795. The advancement of gold coinage production was a great achievement for the U.S., increasing its level of prestige among other great nations. Established countries like Great Britain, France and Brazil were already issuing gold pieces, and the U.S. was ready to do the same. Unfortunately, America’s gold coinage was initially rejected on an international scale. Merchants preferred to use familiar coins like French 24 Livres or Brazilian 4000 Reis over these new American pieces, and, as a result, demand and mintages remained very low.
Finally, in 1804, the U.S. Mint decided to temporarily discontinue the $10 eagle. The smaller $5 half eagle was closer in size to the world’s most recognized and popular gold coins, and as a result it found some acceptance at home and overseas. The $10 eagle, meanwhile, was still largely rejected worldwide.
American gold coins would face another issue in the 1810s and 1820s. As gold spiked during the Napoleonic Wars, U.S. gold coins had a greater melt value than face value. This created an interesting investment opportunity for some, as they would purchase U.S. coins at face value, and melt them down in Europe to sell the gold content for a profit. This investment strategy is known as arbitrage, and in some ways it can still be implemented in the precious metals market today.
The $10 Liberty Gold Eagle was finally discontinued in 1907, when it was phased out in favor of the $10 Gold Indian. President Theodore Roosevelt felt that the $10 Liberty design had become stale and was in dire need of a redesign. This was an appropriate move, as the motif was largely untouched for nearly 70 years and was becoming something that needed to be refreshed. The decades-old Liberty design would vanish from the $2.50, $5 and $20 in 1907 and then the $5 in 1908.
Today, the pre-1933 $10 Liberty Gold Eagle can still be purchased as a semi-rare numismatic coin. Many consider it a nice a piece of American history, and invest in it for the purpose of taking advantage of both its intrinsic metallic content, and its extrinsic collectable value.