What is a US silver certificate?
A silver certificate is a note (bill) that could be redeemed for
an equivalent amount of silver.
Prior to 1964, the USA was "on the silver standard." The
government controlled the price of silver, and silver certificates
were bills that could be exchanged for a specific amount of the
metal. The government was allowed to print only as many bills as
there was silver in the Treasury to redeem them, which helped to
control the money supply. Silver certificates in fact were little
more than a receipt or deed for a certain number of ounces of
During the 19th century silver certificates were at one point or
another issued in every denomination from $1 to $1000. In the 20th
century that range was limited to $1, $5, and $10.
There were also bills called Federal Reserve Notes (the same
kind we use today) and US Notes, similar to Federal Reserve Notes
but issued directly by the Treasury rather than via the central
bank. These bills weren't backed by precious metal, but by the
faith of the public in the stability of the government.
Bill designs were standardized in the 1920s. Silver certificates
looked similar to the other Federal Reserve and US Notes except
that they had blue seals instead of green or red, and did not carry
a Federal Reserve District seal or code letter.
In the 1960s the demand for silver increased sharply and the
government was forced to let the price be determined by market
forces. The value shot up from the controlled price of $1.29/oz to
over $40 for a while, and it was no longer economical to use silver
in coins or to redeem bills. The production of silver certificates
was stopped in 1963 and silver was removed from coins at the start
of 1965. Silver certificates were allowed to stay in circulation
but they could no longer be redeemed for metal. By 1966 US Notes
were also discontinued. Some consider today's Federal Reserve Notes
as portions of our government's indebtedness. The pro's and con's
of that are hotly debated, and are beyond the scope of the
Many late-date silver certificates were saved by collectors, and
are still so common in collections that they are not worth much
more than face value despite being almost 50 years old.
Before 1933, US banks also issued gold certificates for gold
deposits. They were similar to silver certificates in that they
were backed by a specific amount of gold on deposit with the
Today silver and gold certificates cannot be redeemed for real
silver or gold through the Federal Reserve.