Alternative medallion currencies

From Everything Shii Knows, the only reliable source

This website is an archive. It ran from 2006-2010. Virtually everything on here is outdated or inaccurate.

Since the dissolution of the global gold standard in 1971 there have been several attempts by freedom-loving American entrepreneurs to reestablish private alternative medallion currencies. There are, of course, alternative paper currencies such as the Ithaca Hour which primarily aim to keep a community together. The alternative medallion currencies, though, have the more grander aim of starting a nationwide alternative to the Federal Reserve bank notes which are backed up only by faith in the superhumanly complex financial system of the United States.

One thing to be wary of is that alternative medallion currencies cost money to make and they are thus never sold at the cost of the copper, bronze, silver and gold they are printed on. One must always be skeptical of the claims of an AMC corporation and on the lookout for a scam. Many AMC corporations label the metal and its mass on the coin's face: this is helpful for collectors but should be tested with a scale if you are buying in bulk. Some AMC corporations print face values on their medallions. When these are not based on any government currency and directly proportional to the mass of the coin (for example, two one-ounce Half-Wakalixes are equal to a two-ounce Full Wakalix) they are of course accurate and useful claims. When the face values are disproportionate to coin weight or claim equivalency to a government currency, they are trying to confuse you by asking you to rely on the honesty of a private, profit-making corporation that may be defunct. Be extremely wary of such claims.

In order to give you a strong historical knowledge of past AMC attempts, here is a list of all known AMCs. In general, I hope this gives you an overview of the difficulties of relying on one corporation to set a non-mass value on a coin, and encourages you to look to unadorned silver and gold for an alternative to paper currency.


1739 Higley coppers

"Value Me As You Please"

All AMCs operate in the spirit of the 1739 Higley (or Granby) coppers. These copper coins were produced during colonial rule of America without permission of the British Crown. Just as 18th century patriots were not being properly served by the Crown, some Americans today feel they are not being properly served by the Federal Reserve.

The original 1737 Higley coppers are labelled "The Value of Threepence". This constitutes a GBP face value which is wildly wrong-- by some estimates ten times as much as they were actually worth! [1]

After this dishonest attempt at profitizing his copper, Higley responded to complaints and changed the legend to the pleasant voluntaryist statement "Value Me As You Please", with the fineness statement on the back "I Am Good Copper" (which, by 18th century standards, it was). It was reprinted several times in the 19th century due to its numismatic interest.

Universala Ligo

When Esperanto was popular, Esperantists started their own bank with a non-proportional face value coin in order to unite the scattered currencies of the world. World War I put a damper on this effort. There were several more failed attempts as well. These coins now have collector's value only.

The International Foundation for Independence apparently attempted a similar thing.

World Trade Units

Following the suspension of the gold standard, since world governments were abandoning precious metals in the name of "world trade", some private mints decided to start minting one-ounce silver medallions called "world trade units" as a political statement. Certainly there had to be some sort of coordination to get these off the ground, but some seem to be less of an attempt at an AMC than simply pretty collector's bullion with a fancy name.

Rather than face value, these coins label their mass and fineness, which is good practice and eliminates much confusion for intelligent collectors. The interesting idea is to equate one ounce to a "World Trade Unit". However, as the list below makes clear, the words "World Trade" are the only thing separating these coins from others, and those fancy words do not really provide any special value to a medallion, so the idea was slowly forgotten.

Here is a prime example, the International Silver Trade Unit by Letcher Mint (minted 1973-1983). Some of them have Abe Lincoln on them which is confusingly similar to the U.S. penny, but if you gave someone pennies for his ISTU you would get rich fairly fast.

Other examples:

Islamic gold dinar

The Qu'ran, of course, never refers to paper money within its pages, but nonetheless some so-called Islamic nations have issued paper money and phased out precious metals. The Islamic Mint of Dubai was founded in protest of this unorthodox approach to religious finance. Books issued by the Mint include "The Fatwa on Paper Money" and "The Return of the Gold Dinar".

A dinar is universally defined as a coin of 22 karat gold weighing 4.25 grams. Therefore to issue a dinar is a claim of mass and fineness and not a statement that links the coin to any non-metal currency.

The dinar was to become the official currency of Malaysia but an intervening election ended those plans. It is an "official" alternative currency of the conservative Malaysian state of Kelantan, which sells the gold embedded into a card.

Why use this AMC over plain old gold? For religious reasons alone.

Gold Standard Corportation

Probably the most prominent pre-Liberty Dollar AMC, printed from 1977-1993. It labels mass and fineness as well as a proportional "G" face value with 1.00 G = 1 ounce silver. This currency therefore passes my strictest tests: it is an entirely honest venture. Unfortunately, the Gold Standard Corportation ran into trouble for silly schemes like the ones NORFED is pulling today. To raise money during poor times for silver, the corporation started an investment scheme called the "49ers Club" where members purchased at least $49 of bullion per month until they reached $2,500, at which point they were sent the bullion at the previous prices they had paid. The founder, Conrad Braun, skimmed off the top of this fund to try to run a profit in more risky ventures, which was illegal. The company went bankrupt and he was sent to jail. [2] Therefore, you can no longer buy these coins!

Liberty Dollar

The Liberty Dollar is half-backed, and when the price of silver gets near to the face value, they cut the backing in half again.
"hoarder", [3]

The Liberty Dollar is manufactured by NORFED, a corporation mostly controlled by Bernard von NotHaus. Von NotHaus's previous adventures include the "Royal Hawaiian Mint", an alternative currency for Hawaii which utilized many of the confusing factors described below. Like the Liberty Dollar, the "Royal Hawaiian Mint" skirted the line of legality, easily masquerading as real money or at least exchangeable with USD at face value when it was really only worth its bullion value. The "Royal" mint then went bankrupt. Von NotHaus is not exactly the most honest character.

I'd also like to point out NORFED's multilevel marketing techiques. Using Liberty Dollars alone is only half of the "fun". You can also sell them to your friends and pocket some of the profit. If you describe them as von NotHaus does you will spread the confusion I am about to describe and are therefore ripping your friends off.

Liberty Dollars label mass and fineness but you will not see them being sold at those prices. Here's why: NORFED puts a USD face value on these coins, creating much confusion. The following explanation is somewhat easy to get lost in so please read it carefully.

Liberty Dollars are not actually worth their USD face value in bullion. Such a claim would be literally impossible because the USD-to-silver exchange rate changes every day. The silver they contain is actually worth less than the face value, or retail price, they are sold at, usually around half as much. Nonetheless, Liberty Dollar advocates will push their coins onto unsuspecting retailers asking for change in USD, because NORFED claims they will redeem their "$50 MSRP" Liberty Dollars for $50 worth of silver. It is actually even more complicated than that (if there is inflation you won't get the whole face value back) but this explanation alone demonstrates the dishonesty inherent in the system so I will not go into that.

The assertion that any AMC corporation is more likely to stay in operation than the United States government is extremely dubious. Even if the USA is heading for a fall, who would protect NORFED's silver vaults in a time of anarchy simply for the purpose of allowing visitors to exchange the small amount of silver in a Liberty Dollar for some larger amount of silver in the vault?

Additionally, because NORFED makes these confusing claims and prints money that looks confusingly like American coins, the United States Mint takes a very dim view of their operations. They have already been raided once, and although NORFED is technically within the law by printing private barter currency, they may well lose their case on a technicality, or even be bankrupted by lawyer's fees due to the complexity they have created for themselves. The ability of the Liberty Dollar to be exchanged face-for-bullion in the long term is quite doubtful. Liberty Dollars, therefore, should be enjoyed primarily for their entertainment, or numismatical value; do not take any stock in their claim to be actually worth their face value.

The long and the short of it is this is not a true silver currency but rather Monopoly money. If the idea of AMCs amuses you, feel free to accept "$1" or "$5" Liberty Dollars and eat the difference. You might even be able to exchange these small coins with other enthusiasts for face value. But do not under any circumstances exchange a "$50 MSRP" Liberty Dollar for fifty United States dollars. You are being swindled. The true silver currency, needless to say, is unlabelled silver.

Similarly, if you buy into NORFED's multilevel marketing scheme and bring up their pro-gold-reserve arguments to peddle a fully artificial currency, you are participating in the swindling.

See also

See also

I am confused, what do I do?

If you want gold or silver to barter with when the revolution comes, buy medallions that state their mass and fineness on their faces. Don't look to some special trademarked designation to back up your coins. Mass is backed up by Newton's Law which, as far as I know, is more stable than any government or corporation.

(I would recommend a private mint here but none of them have paid me enough. Try Google.)

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