Spain’s silver dollar
The key to hundreds of years of power
The silver standard which garners the most attention in history is the ‘Spanish dollar’ or piece of eight, which was a silver coin minted by the Spanish empire.
The fifteenth and sixteenth centuries saw international trade explode as countries of Western Europe set up colonies across the world.
Spain exploited the vast resources discovered in Central and South America, one of which was silver bullion. The mining of silver in both Bolivia and Mexico saw the flow of silver coins from the Spanish Empire increase at a colossal rate, from less than 1 ton in the 1520s to over 3000 tonnes of silver bars in the 1590s.
The Mexico Mint began striking the Spanish dollar coins in the late 1530s, however it was monetary reform in 1497 and the existence of the Austrian Guldengroschen which first brought about the Spanish Silver Dollar.
In the American colonies, the English would not allow coins to be minted. Therefore they became to rely on foreign currencies to use in foreign transactions. The most popular foreign currency was the Spanish dollar.
Due to its wide usage across Europe, the Far East and of course, the Americas, the silver dollar became an international currency. By 1570, Spanish pieces of eight were arriving in such places having been minted from the colonies in South America.
The Spanish milled dollar, minted from 1732 by the Mexican Mint, was highly respected thanks to its ‘milled’ edge which prevented it from being clipped or shaved by dishonest tradesmen. The sophisticated minting process also meant the dollar was now more sophisticated in terms of weight and size. Their respectability meant they were countermarked by other governments for use in their own countries.
The Spanish dollar remained legal tender in the United States, along with other national currencies, until 1857. Many currencies which still exist today were based on the Spanish dollar, including the US dollar, the Japanese yen and the Canadian dollar.