Krugerrand

The face of Paul Kruger, shown on the obverse side of the coin.

A Krugerrand is a South African gold coin, first minted in 1967 in order to help market South African gold. The coins have legal tender status in South Africa but are not actually intended to be used as currency, which is a reason it is regarded as being one of the world's medal-coins.

History

The Krugerrand was the first bullion coin to be tenderable at the market value of its face gold content; by contrast, earlier gold coins such as the gold sovereign had a tender value in currency engraved on their face, which could be completely divorced from their market value. The Krugerrand was the first gold coin to contain precisely one ounce of fine gold, and was intended from the moment of creation to provide a vehicle for the private ownership of gold. By bestowing legal tender status upon the coin, Krugerrands could be owned by citizens of the United States, which at that time prohibited private ownership of bullion but allowed ownership of foreign coins. However, due to the policy of apartheid in South Africa, the Krugerrand was declared illegal to import in many Western countries during the 1970s and 1980s until that system was lifted between 1990 and 1994.

Properties

Originally, it was sold at a significant premium of five percent over the base gold value, and only one size of coin was made, containing one troy ounce (31.1035 g) of gold. Today Krugerrands are offered in a variety of sizes, at attractive premiums of no more than one percent above the market price of gold.

Since the Krugerrand is minted from gold alloy that is 91.67 percent pure (22 karats), the actual weight of a "one ounce" coin is 1.0909 ounces (33.93 g), to provide one ounce of pure gold. The remainder of the coin's mass is made up of copper (2.826 grams), giving the Krugerrand a more orange appearance than silver-alloyed gold coins. Alloys are used to make gold coins harder and more durable, so they can resist scratches and dents during handling. In 1980, three other sizes were introduced, offering a half, quarter, and tenth ounce weights. In total, 54.5 million coins have been sold.

Krugerrands: Their gold content is exactly one troy ounce.

Krugerrands are a popular way to invest in gold because they have low premiums over spot pricing.

The Krugerrand gets its name from the fact that the obverse shows the face of Paul Kruger, a prominent Boer resistance leader against the British and eventually the fifth, and last president of the old South African Republic holding that office for four terms. The reverse depicts a springbok antelope, one of the national symbols of South Africa that was designed by Coert Steynberg and used on the reverse of the earlier 5 shilling South African coinage for King George VI and Queen Elizabeth II. The name "South Africa" and the gold content are inscribed in both Afrikaans and English.

The word Krugerrand is a registered trade mark owned by Rand Refinery Limited, a South African corporation of Germiston, South Africa.

The success of the Krugerrand led to many other gold-producing nations minting their own bullion coins, including the Canadian Gold Maple Leaf in 1979, the Australian Nugget in 1981, and the American Gold Eagle in 1986.

Edge - Number of Edge Serrations

Silver Krugerrand

During the 1980s, a (so-called) silver Krugerrand was struck; however, this was struck privately. The most common dates that have been seen are the 1982 and 1983 issues, but other dates have been reported. The 1982 issue commemorates the 15th anniversary of the gold Krugerrand, and the 1983 issue commemorates the 16th anniversary of the gold Krugerrand. It is interesting to note that there is no reference to South Africa anywhere on these coins. Like the gold Krugerrand, the silver Krugerrand is traded based on its bullion value. The silver Krugerrand is arranged in coinage alignment, as opposed to the medallic alignment of the gold Krugerrand. Like the gold Krugerrand, the silver Krugerrand also has a milled edge.

As the word krugerrand is a trademark, it is not correct or legally sound to refer to these silver discs as "silver krugerrands", they are medallions which merely purport to be silver krugerrands, in breach of the intellectual property rights of the trademark owner. It may be noted that there is no indication on these medallions of who issued them.

Obverse details of the silver Krugerrand

The obverse has the portrait of President Kruger in high relief. His name is inscribed as 'STEFANS JOHANNES KRUGER'.

Reverse details of the silver Krugerrand

The reverse depicts Coert Steynberg's pronking springbok design, just like that on the gold Krugerrand. Above the springbok is the inscription 'ONE TROY OZ .999 FINE SILVER' in three lines. Around the design is the inscription 'KRUGERRAND COMMEMORATIVE' and the double dates '1967-1982', '1967-1983' and so on.

Silver Krugerrand fractional coins

These have been reported. The most common silver Krugerrand fractional coin that turns up is the 1/10 Krugerrand.

See also

• Gold as an investment
• Inflation
• South African rand

External links

Wikimedia Commons has media related to:

Krugerrand

• Current price of Gold Ounces (XAU) in U.S. Dollars (USD)
• British Pounds (GBP)
• South African Rand (ZAR)

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