This Trade Dollars was Sold for Over Two Million Dollars 

When most people think of collecting coins, they usually imagine collecting legal tender domestic currency.

But there's a little-known class of US currency that was never intended for use in the country: the US trade dollar. This was a silver coin produced only in the 1870s, and it was very similar to the contemporaneous Morgan silver dollars.

But the history of the trade dollar is somewhat more interesting. For one thing, the coins were intended for foreign markets. That makes them very rare in the United States.

For another, they were discontinued after less than ten years. Only collector's proofs were struck in limited issues for a few years afterward.

But not all trade dollars belong to this far-off period of US history. The Maui trade dollar is an example of a recent iteration of this unusual coinage. In recent years, it's become very popular with collectors.

So let's dive a little deeper into the history of these strange coins. Along the way, we'll see how the trade dollar value has far exceeded its face value when collectible coins come up for auction.

The Trade Dollar: A Brief History

The trade dollar forms a colorful interlude in the history of both international coinage and international trade.

In simple terms, trade dollars are silver coins produced for commercial trading in the Far East. The first trade dollar was a standard circulation Spanish coin known as the "8 Reales." This large, handsome silver coin was a standard trade medium throughout the Spanish territories.

The 8 Reales piece was much in demand among Chinese merchants. This was due in large part to its plentiful circulation numbers and its consistent minting. These coins circulated for about a century. But with the secession of Spain's New World colonies in the early nineteenth century, the 8 Reales coin was no longer minted and distributed.

For those countries that transacted business in the Far East, it was necessary to find a new medium for trade. This is where the trade dollar enters the story. Britain, France, Japan, and the United States all had their own trade dollars.

Chinese merchants, accustomed to the high silver content of the 8 Reales piece, would accept nothing less as a medium for exchange. So, using their own silver supplies, different countries produced special trade dollars with higher silver content than their usual "dollars" or equivalent domestic currencies.

The Opium Wars

The efflorescence of Far East trade followed on the heels of a fortuitous discovery by the East India Company. Seeking a means of escaping from its crushing trade deficit with China, the Company realized it could export Bengalese opium for the China trade.

There was only one problem: the Chinese emperors had imposed strict bans on the importation of opium. In a curious historical parallel with the modern "Opioid Crisis" afflicting the US, the illicit opium trade in nineteenth-century China had devastating effects on the population.

Nothing daunted, the East India Company smuggled the opium into China through illegal traffickers and agency houses. The situation grew very dire until 1838. This year, the Chinese emperor levied the death penalty against those caught smuggling the drug into the country.

This was the immediate cause of the First Opium War. During the conflict, the Chinese were defeated by the British, who upheld the East India Company's claims to free trade in China.

The result of the war was the establishment of treaty ports and the opening up of China to increased opium trade. And increased trade with China meant higher demand for silver dollars deemed acceptable by Chinese merchants.

So trade dollars skyrocketed in popularity. Commercial trade in the Far East was big business, and the European powers, together with the United States and Japan, minted trade dollars to keep up with demand.

The Chinese "Chop Marks"

One of the more fascinating aspects of trade dollars is that they often display unique stamps or marks, known as "chop marks." These were special sigils that Chinese merchants would stamp into the silver trade dollars.

The reason for this unusual practice was to ascertain the silver content of the coin. It was also meant to verify that it was a genuine silver dollar acceptable at face value. Chop marks were in the form of Chinese characters and represented a kind of signature belonging to a specific merchant or merchant house.

As the trade dollars changed hands, merchants would often chop the coins with their own unique mark. This is why it's possible to trace the fascinating history of a particular trade dollar in nineteenth-century China. All one has to do is read the various incised characters on the coin.

As to how the presence of chop marks affects the value of trade dollars, the jury is still out. In general, chop marks can lower this value by up to 50 percent. But for some coins, especially the rarely chop-marked 1875 and 1878 issues, their presence can boost the value by a substantial margin.

History Of The US Trade Dollar

The particular story of the US trade dollar is an interesting one, and neatly encapsulates the history of trade dollars in general.

Following the conclusion of the American Civil War, the United States was reunified and ready to explore new markets. For too long, the country had been distracted by internal strife. Now it was ready to resume its main business, which was…business.

As a result, trade between China and the United States blossomed throughout the late 1860s and early 1870s. But there were impediments to this fruitful new trade relationship. It turned out that Chinese merchants preferred foreign currencies, such as the Mexican peso.

The Chinese valued Mexican currency over US coins because the pesos contained more silver than the dollar. And this constituted a severe handicap to American merchants that wished to do business in China. For instance, Americans had first to convert their US dollars into Mexican pesos, the ancillary fees of which process were becoming prohibitive.

The Trade Dollar Is Born

The answer, of course, was for the US government to mint a special-purpose trade dollar for use in the Far East trade.

The first US trade dollars were issued in 1873, and they were rather more substantial than the typical American silver dollar of the time. It comprised 90 percent silver content, which matched the content of standard-issue "Seated Liberty" silver dollars of the time. However, it weighed quite a bit more, even more than the peso, at 420 grains against the peso's 416.

The trade dollars were a great success. In 1873 and 1874, the coins were sent overseas for exclusive use in trade. Chinese merchants accepted the new trade dollars with enthusiasm.

This allowed US businesses to circumvent the arduous exchange process. At the same time, US coinage cornered the market in the China trade.

Meanwhile, trade dollars helped ease inflationary pressures at home. It was now possible to siphon off some of the silver supply that was flooding the market from the new mines operating in the American West.

In the 1860s and '70s, silver strikes in the San Juans and Sawatch ranges of Colorado attracted prospectors from around the country. These "silver rushes" led to an explosion of new mining towns with colorful names, such as Silverton, Ouray, Aspen, Creede, Telluride, and Leadville. Meanwhile, in Nevada, the discovery of the Comstock Lode and the silver strike in the Eureka district opened up further silver sources.

By packaging some of this new silver in trade dollars, and sending it off to foreign markets, the government was able to ease some of the pressures on the domestic currency. In time, the trade dollar was even made legal tender in the United States.

End Of The Trade Dollar

But even these easing methods were of limited long-term efficacy.

The production of silver from the rich western mines was too much for the global markets to handle, and silver prices plunged to record lows. US trade dollar value, for instance, fell to just 80 cents. In the meantime, overseas trade dollars were now flooding the country, and people tried to spend the dollars at their face value.

The predictable result was that the US Congress, in 1876, acted to revoke the trade dollar's legal tender status. Minting of trade dollars continued, but the coin was now only legal for foreign trade.

Finally, in 1878, production of United States trade dollars ceased on the orders of Treasury Secretary John Sherman. Even so, beginning the following year, the Treasury continued to issue trade dollar proof strikes for collectors. Then, in 1887, Congress passed a law that let holders of US trade dollars redeem their coins. Around eight million trade dollars thereby reentered the US coffers.

And so ended the brief story of the US trade dollar. The coin was minted for less than a decade, but even so (or perhaps for this very reason), the coins are much prized by coin collectors. The rarity and popularity of the US trade dollar also make it a target for the unscrupulous, and collectors are very careful about determining the authenticity of any coins that come to market.

The Design Of The US Trade Dollar

With the passage of the Coinage Act of 1873, which was signed by Ulysses S. Grant in the early part of that year, work began on designing the new coin.

Henry Linderman, the Superintendent of the US Mint, and the Director of the Mint James Pollock gathered to discuss the configuration of the trade dollar. The Mint's Chief Engraver, William Barber, set to work crafting a set of designs that would compete for the honor of being embossed on the coin.

Linderman requested the coin's obverse must depict a seated Liberty facing to the left as seen by the coin's holder. This was meant, of course, to represent the personification of the United States gazing in the direction of East Asia. This is somewhat strange, given that the Far East is traditionally represented as the land of the rising sun, and thus the Liberty ought to be facing to the right.

In June of 1873, Linderman chose a design by Barber for the trade dollar. It depicted a woman (Liberty) seated upon bales of goods and a sheaf of wheat. These represented the international trade for which the dollar was coined. The female figure holds a scroll with the word "Liberty" upon it, as well as an olive brand in her right hand (a gesture of peace).

On the reverse of the dollar is the American bald eagle, bearing olive branch and arrows, as required by law. Moreover, the legend on the reverse is "Trade Dollar," and includes the weight and fineness of the silver in the coin.

The 1885 Morgan Silver Dollar

It's interesting to compare the US trade dollar to the contemporaneous Morgan silver dollar. The size and weight of the coins are very similar (though the trade dollar is larger), as in many ways are the designs and legends on the coins.

The Morgan silver dollar, of course, was in circulation for a much longer time. It was also intended for domestic use, unlike the trade dollar. But as a collector's item, the trade dollar is somewhat more unusual and interesting. Its short run, its use in foreign trade, and potential chop marks all make the trade dollar a fascinating choice for collectors.

Plus, as we'll see, some issues of the trade dollar are of incredible rarity.

Specific Trade Dollar Examples

The US trade dollars only had a limited run. And when it comes to selling trade dollars, a trade dollar's value can depend a great deal on which year it was issued.

This is why it's interesting to take a look at some examples of trade dollars from different years. There's not much to distinguish them, but some of them have their own unique stories to tell.

1873 Trade Dollar

An 1873 trade dollar has a certain degree of interest based on the fact that it is the first issuance of American trade dollars.

If the coin is in decent condition, it has great value for collectors. As we've mentioned, chop marks can devalue such a coin by up to 50 percent. But depending on a collector's interests, and the uniqueness and placement of the chop marks, it could add to a coin's value.

The trade dollar for 1873 comes in three mint marks: no mark at all indicates the Philadelphia Mint, "CC" represents the Carson City Mint, and "S" represents the San Francisco Mint. The "CC" coins are the rarest and the most valuable, with fine specimens going for upwards of a thousand dollars. An MS 63-grade coin can fetch quite a bit more.

1876 Trade Dollar

The 1876 trade dollar issue is somewhat noteworthy, largely for what might have been.

Since 1876 was the United States centennial year, Superintendent Linderman proposed that the coin's reverse be changed to commemorate this important event. Anthony C. Paquet, an assistant engraver at the Mint, even created a new reverse die in preparation of the new issuance.

Although Linderman approved the new design, Mint officials rejected it. They harbored a fear that the Chinese might be suspicious of the new design, and disfavor the coin for continued use.

So the actual 1876 issues of the trade dollar are the same as all the other issues and fetch similar values at auction.

1877 Trade Dollar

The 1877 trade dollar is very similar to the trade dollars of previous issuing years.

As with the 1873 trade dollar, the 1877 variety was minted in three US mints, including Philadelphia, Carson City, and San Francisco. The Carson City issue, of course, is the rarest and therefore the most valuable.

The San Francisco and Philadelphia issues can fetch a nice sum, usually in the range of a few hundred to a thousand dollars depending on the coin's condition. The Carson City coins earn quite a bit more at auction, with uncirculated specimens going for several thousands of dollars.

1884 Trade Dollar

The 1884 trade dollar represents one of the rarest issues in the entire trade dollar series.

The 1884 trade dollar was only struck in proof format, and the truth is the coins weren't even known to exist by the wider public until about two decades after their issuance.

After the passage of the Sherman Silver Act in 1878, trade dollars were no longer minted and circulated for foreign trade. The Philadelphia Mint did continue to produce trade dollars in small numbers, however, from 1879 to 1883. These were in the form of limited-issue proofs, often no more than 1,000-2,000 coins.

By 1884, the production even of these proof coins ceased altogether. But US Mint records indicated that ten 1884 trade dollar proof coins had been issued. These ten coins have all been accounted for.

Any time these coins come up for auction, you can expect that they will sell for a hefty sum. The last 1884 trade dollar that sold went for $1 million.

1885 Trade Dollar

The 1885 trade dollar is even rarer than the 1885 trade dollar.

Although trade dollars were discontinued in 1883, we've seen that a few coins of the 1884 issue were struck nevertheless. In 1885, Mint employees secretly struck no more than five 1885 series trade dollars. All five of these coins are accounted for, and selling trade dollars of this mintage can fetch fabulous sums when they come up for auction.

In January of 2019, the finest-known example of an 1885 trade dollar sold at auction for $3.9 million. Two other coins have sold for over $1 million in other auctions.

Maui Trade Dollar

The Maui trade dollar is an intriguing entrant in the list of trade dollars.

For one thing, this unusual coin series is still in production and began its run about a hundred years after the original trade dollars of the nineteenth century. The issuance of Maui trade dollars has come in fits and starts, with occasional decade-long gaps occurring between series.

The first series of Maui trade dollars were struck in 1959, and this was done in commemoration of Hawaii's new statehood. The second series of these trade dollars appeared in 1973 and continued until 1976. These attractive coins depicted the famous Iao Needle, a celebrated landmark in Maui's Iao Valley National Natural Landmark.

The third series was issued from 1976 to 1992, and the fourth and current series has been issued since 1992. Maui trade dollars aren't silver dollars, as were their predecessors.

Instead, they come as copper-nickel alloys, with 75 percent copper and 25 percent nickel content. The coins are about a millimeter larger in diameter than a US silver dollar. One of the interesting things about these coins is that they feature a new "obverse" design each year, showcasing the beauty and natural wonders of the state of Hawaii. In many ways, this is like the "America the Beautiful," "50 States," and "National Parks" quarters collections issued by the US Mint in recent decades.

In any case, Maui trade dollars are sold as souvenirs and tourist tokens, but they're still quite popular. And don't forget the possible currency uses of these coins. Maui trade dollars can compete in their own way with federal currency as long as local merchants accept them.

For the collector of trade dollars or coins of any kind, Maui trade dollars make for an excellent acquisition.

Start Collecting Trade Dollars

If you're interested in collecting rare and unusual American coinage, the US trade dollar is a good place to start.

Now that you know the difference between an 1885 trade dollar and an 1885 Morgan silver dollar, you can begin your collection. Of course, these coins can often be expensive, but the trade dollar value of some of the more common issues needn't be out of reach.

Or you can always start with the little-known but less pricey Maui trade dollar. Whether it's a relatively common San Francisco-series 1873 trade dollar, or one of the ten existing 1884 trade dollars, there's a trade dollar for every coin collector.