Bread, Cash, Dough-The History Of American Paper Money
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An Introduction To American Paper Money

The first American settlers primarily used gold and silver as currency to pay for goods and services. This practice continued until it became harder to obtain these precious metals. Therefore, most of the American colonies saw it was necessary to produce their own paper money. The demand for printed money increased as Britain restricted the amount of gold and silver that it exported.



From the 1600's to 1800's

The first form of paper money to be used in circulation emerged between the late 1600's to early 1700's. Originating in the area currently known as the Massachusetts Bay Colony, or the province of Massachusetts. This area has become the present day cities of Boston and Salem, Massachusetts.



However, the use of a widespread currency over the whole continent of the United States was necessary with the war of the American Revolution in 1775. From this point on, the Bank of North America issued paper money to support the war until 1781. During the free banking era of 1830 to 1867, there was no standard chartered bank to oversee printing until the National Banking Act of 1863.





From the 1900's To The Present

The National Banking Act was created after a series of financial difficulties within the banks of the United States. This established the printing and engraving of American paper money by the Bureau of Engraving and Printing of the US Treasury. In 1913, the bureau continued to print "silver and gold certificates," which were redeemable for bars of silver and gold. The last of the silver and gold certificates were phased out in the late 1920's.



Also during this time the Federal Reserve Act was established. It made it possible for the first centralized printing of paper money or the "$1 Federal Reserve Bank Note" to occur in 1914. These notes were printed until the early 1970's. In 1963 the Federal Reserve started printing one of the most popular money known today, the $1 dollar bill. Its name was changed to the "$1 Federal Reserve Note". From this point onwards in history, not many changes were made to American paper money within the United States until the late 1990's when more security features was implemented to the fifty and one-hundred dollar notes. This was due to it becoming easier to produce counterfeits, so features such as micro printing and security threading were introduced. Since the late 1990's, a new design to the fifty-dollar note was established, but many shop owners are now reluctant to accept the one hundred dollar note in fear that it might be counterfeit.