Establishing American currency and its value has been on an ongoing project for hundreds of years. It began as a way to separate the colonies from imperial rule and continues to progress and change even today. Images of the first bills issued by the Massachusetts Bay Colony are a far stretch from the cash that most people currently handle. From the very beginning, counterfeiting threatened the monetary system established. Different methods for maintaining authenticity continue to prevent individuals from working to print their own money and pass it off as real U.S. currency. While many take for granted how the monetary system works, it is an intricate and complex set of principles that dictate the value of money, how it can be spent, and how it can be obtained.
1690 Colonial Bills: An increase in military expenses and the delay of payment from Europe forced the colonists to come up with a way to document a person’s payments and his or her expenses.
1739 Franklin’s Unique Counterfeit Deterrent: Nature came in handy while Benjamin Franklin printed money. Using different leaves, he created raised impressions on the paper that made it difficult for someone else to duplicate.
1764 British Ban: England, as a way to demonstrate her power over the colonies, banned all use of colonial currency. England assumed that by forcing the colonies to use English currency, the people would come to realize their true dependency on the European country.
1775 Continental Currency: With the cost of the Revolutionary War increasing, the Continental Congress started to issue its own paper currency. Unfortunately, it was easy to counterfeit and the bills soon held little to no value to the Americans.
1781 The Bank of North America: The establishment of the first national bank offered support to a new government attempting to solidify its leadership and procedures. Shares of the bank offered to the public made this the first instance of an initial public offering, currently known as an IPO.
1785 The Dollar: At a time when different colonies were using different types of currency, the U.S. needed a way to bring everyone under the same financial system. The adoption of the dollar signaled a coming together of the colonies and a big step towards modern currency.
1791 First Central Bank: For 20 years, the First Central Bank served the U.S. government in all fiscal matters. While the idea of a central bank was accepted and found to be necessary, the original banks charter was not renewed. Later, another charter was established and a new bank took over the responsibility.
1792 Monetary System: While the dollar was the first step towards unity, the Coinage Act of 1972 solidified the federal monetary system. The U.S. Mint was created and specific denominations of coins and their values were established.
1861 Greenbacks: Overseeing coins wasn’t enough for the federal government and it began printing paper money in 1861. This was in large part due to the need for money to pay for the expenses created by the Civil War. This paper money still holds value today and can still be redeemed.
1861 First $10 Bills: Demand bills issued by the Treasury Department during the Civil War featured a picture of Abraham Lincoln on the left side. Payment for services for military personnel and other government workers came in the form of these $10 bills.
1862 Counterfeit Deterrence in Design: Fine line engraving worked to prevent the money produced by the government from being duplicated. The seal of the treasury, along with engraved signatures were featured on every bill.
1863 National Banking System: The U.S. Treasury took over issuing bank notes as a national banking system came into existence. Regulations guided the banks and authorized them to issue currency. Under the guidelines provided, banks all functioned in a similar manner.
1865 Secret Service: In order to solve the problem of increased counterfeiting, the U.S. Treasury created the Secret Service. Counterfeiting caused public confidence in American currency to decrease.
1877 Bureau of Engraving and Printing: Smaller departments within the U.S. Treasury took over certain tasks for handling American currency. One department, Engraving and Printing, printed all of the U.S. currency, while others focused on other aspects of the American financial situation.
1905 Paper Currency with Background Color: This year, the last instance of money featuring colors other than green came in the form of a $20 gold certificate. In 2003, the use of colors returned to the process of printing money.
1913 Federal Reserve Act: The creation of the Federal Reserve established a central bank for the United States as well as a national banking system. The country continued to see changes is its financial needs and needed a bank and a system that would be able to accommodate the variations. Federal Reserve Notes served as a new type of currency.
1914 The First $10 Federal Reserve Notes: Larger than the current $10 bill, the $10 Federal Reserve Note went into circulation in 1914. President Andrew Jackson served as the individual portrayed on each bill.
1929 Standardized Design: While the value of currency stayed the same, the physical size of the currency was reduced. With a standardized design, fewer instances of various types of currency created more of a cohesive American financial system.
1957 In God We Trust: In 1955 a law passed that guaranteed the words, “In God We Trust,” the national motto, would be featured on all currency. It first showed up on the $1 Silver Certificates in 1957.
1990 Security Thread and Microprinting: Advanced printers started to print counterfeit currency and the U.S. needed to take action right away. In response, the security thread and microprinting processes were introduced to deter duplicate copies from being circulated.
1996 Currency Redesign: Once again counterfeiting forced the hand of the U.S. government. For 67 years, no significant changes had been made to currency. This year, several measures were taken to deter counterfeiters from making copies of American money. In order to avoid the constant improvements that counterfeiters were making, the Bureau of Engraving suggested that changes be made every 7-10 years.
2003 Secret Service Integrated into Homeland Security Department: Protecting U.S. currency transitioned to a national security issue and the Secret Service is integrated into the Homeland Security Department.
2003 U.S. Government Issues Redesigned $20 Bill: Background colors added to the $20 bill ensured that counterfeiters would once again be deterred in their efforts to duplicate American money.
2004 U.S. Government Issued Redesigned $50 Bill: A red and blue background, as well as an image of the American Flag were added to the $50 bill as part of the redesigning process.
2006 U.S. Government Issues Redesigned $10 Bill: Subtle changes in color along with new American symbols became part of the newly redesigned $10 bill.
2006 Safer $5 Bill: An announcement was made regarding the changes to the $5 bill; however, it would take time to come up with a new plan for this version of currency.
2007 $5 Bill “Wi-5” Digital Unveiling: To show the American people the changes made to the $5 bill, the announcement was made digitally and word spread quickly.
2008 Redesigned Series 2006 $5 Bill: The new $5 bill was easy to check with a few different security features in place.
2010 New $100 Note: Advanced technology made the unveiling of the new $100 bill an exciting moment. While it looks much like traditional U.S. currency, there are several security features in place that make it difficult to counterfeit.
To learn more about the history of American money, consult the following links.
- History of Money From Ancient Times to Present Day
- Brief History of Money
- The History of Money
- Legendary Coins and Currency
- The First Printed Currency: Massachusetts Bay – December 10, 1690
- Guide to the American Currency Collection 1748-1871
- Showcase of Bills
- Symbols on American Money
- U.S. Coins Historical Questions
- Fun Facts About Money
- Historical Legislation Involving Money
- Know Your Money
- Major Milestones in the History of American Money
- The Office of the Comptroller of the Currency