Last Updated on February 20, 2025
Key Takeaways
- Issued from 1878 to 1965, silver certificates were once redeemable for silver dollars but lost this feature in 1968.
- Silver certificates were created because carrying heavy silver coins was impractical—just as digital money is preferred today over physical cash.
- Redemption rights for silver certificates were revoked in 1968, just before the U.S. ended the gold standard in 1971.
- Those who held silver dollars retained their metal wealth, while silver certificate holders were left with fiat paper.
- Though no longer exchangeable for silver, rare silver certificates can be worth far more than face value to collectors.
Silver certificates are a historic form of currency in the United States, issued between 1878 and 1965.
Originally able to be exchanged for silver bullion, they are still legal tender, but can no longer be converted into the precious metal.
Today, silver certificates are likely to have a collectible value that far exceeds their face value and can be bought and sold at many precious metals dealers.
The Short History of Silver Certificates
Silver certificates were first issued in 1878.
But to understand why, we need to backtrack five years to 1873 and get a bit of context about the history of silver as money in the United States.
In 1792, the U.S. Dollar was defined as a fixed weight of silver and the nation was put on a bimetallic monetary standard. Just over 80 years later, in 1873 a new Coinage Act was passed which removed the right of holders of silver bullion to have their metal converted into silver coins by the U.S. Mint.
Known as the Crime of 1873 this was a death blow to the holders of silver bullion and silver miners.
It had a dual effect:
- It ended the bimetallic standard that had been in place since the founding of the country.
- It put the nation on a de facto gold standard.
Silver interests didn’t accept the blow meekly. They formed the “free silver” movement and they were about to put up one hell of a fight.
Their first win came in 1878 with the Bland Allison Act. This act restored silver to legal tender status and compelled the Treasury to purchase silver bullion in the range or 2 – 4 million dollars every month at market price and coin it into money.
This was not the free coinage of silver where any amount of silver could be presented to the mint. But it was a compromise that absorbed some of the silver production.
The first silver certificates were issued in 1878, authorised by the Bland Allison Act and were redeemable on demand for silver coins.
The Bureau of Engraving and Printing at the U.S. Treasury describes their purpose:
“The purpose of the certificates was to give people an alternative to carrying numerous silver dollars. It was easier to carry around and transport the paper certificates than bags of coin. Silver dollars were not very popular as most people preferred to use notes.”
However, the initial certificates were not allowed to be any less than $10 and were printed in denominations ranging from $10 to $1000.
This was changed in 1886 when Congress authorised the issues of $1, $2 and $5 denominations, which greatly increased their circulation.
In 1900 the Gold Standard Act formalised the United States’ move to the gold standard.
Silver certificates were unaffected and were still able to be redeemed for silver dollars.
Not much changed with regards to silver until 1934 when President Roosevelt signed the Silver Purchase Act which created a federal purchase programme designed to support Western mining interests.
This Act reinforced the status of silver certificates, stating:
“All silver certificates heretofore or hereafter issued shall be legal tender for all debts, public and private, public charges, taxes, duties, and dues, and shall be redeemable on demand at the Treasury of the United States in standard silver dollars; and the Secretary of the Treasury is authorized to coin standard silver dollars for such redemption.”
The key authority on the history of the white metal, William Silber (he really should be called William Silver), describes the significance:
““The Treasury paid for bullion under the Silver Purchase Act either by creating silver dollar coins containing about three-quarters of an ounce of silver or by issuing silver certificates in one-dollar, five-dollar, and ten-dollar denominations. The Treasury’s certificates closely resembled Federal Reserve notes issued by America’s central bank, the dominant form of money in the United States, except the label “Silver Certificate” instead of “Federal Reserve Note” appeared at the top. The different types of money were equally accepted everywhere, such as paying for groceries at the local supermarket or settling obligations with the IRS, and were used interchangeably except for silver dollar coins, which were too bulky to carry…Silver certificates issued under the Silver Purchase Act felt just like crisp Federal Reserve notes, smelled the same, and had pictures of Lincoln and Hamilton gracing the five-dollar and ten-dollar bills, respectively. But there was a difference: Treasury currency carried a claim to silver held at West Point while Federal Reserve notes did not. A person with a one-dollar silver certificate could demand from the U.S. Treasury a silver dollar coin containing .77 ounces of silver, which translates into getting an ounce of silver at the official mint price of $1.29. A ten-dollar Treasury certificate would exchange for ten silver dollar coins, of course. No one chose to exercise the exchange option back then because buying silver at about 45¢ an ounce in the bullion market was cheaper. But this option to get the underlying metal gave silver certificates a whiff of pre-1933 American currency, when all dollar bills could be exchanged for gold at the rate of $20.67 per ounce.”
The 1960s and early 1970s saw the final demonetisation of gold and silver from American currency.
The government’s silver purchase programme hit a massive problem when the market price broke above the fixed price it had set, triggering a run on the government’s silver.
President Kennedy (R.I.P.) suspended government sales of silver, before beginning the process of demonetising it altogether.
As part of that broader process, silver certificates ceased to be issued in 1965. In 1968 they were no longer redeemable in silver bullion and could only be exchanged for Federal Reserve Notes.
Any certificates that ended up in the U.S. Treasury were removed from circulation.
The only ones that survived were held by people who preferred to keep the certificates rather than exchange them for Federal Reserve Notes.
How Much Are Silver Certificates Worth Today?
The value of a silver certificate depends on its condition and rarity.
Many certificates are only worth a few dollars, but rare ones, such as a 1928 D series note, in top condition can be worth five figures.
How To Sell Silver Certificates
There are basically three options available for selling certificates.
- List it at an auction site such as Heritage Auctions.
- List it on an online marketplace such as eBay.
- Find a precious metals dealer who also trades in silver certificates and sell it to them.
4 Lessons From A Study of Silver Certificates
1. People Like Convenience In Their Money
Despite the yearning of some to return to the days of using physical metals for transactions, paper (and now digital) money is preferred over bulky physical assets for day-to-day transactions.
Silver certificates were introduced because people found carrying stacks of heavy silver dollars impractical.
Today, most people prefer digital transactions over cash, just as they once preferred paper certificates over silver coins.
Convenience often trumps hard asset backing in monetary systems. Bear this in mind as we navigate the world of digital currencies.
2. Government-Backed Paper Can Lose Its Convertibility
A government promise to redeem paper money for a hard asset is not permanent.
Silver certificates were originally redeemable for silver dollars, but this ended in 1968, making them just another fiat currency.
The same happened to the U.S. dollar in 1971, when President Nixon ended the convertibility of dollars to gold.
Any government-backed currency, even one tied to gold or silver today, can have its redemption terms changed or revoked entirely.
3. Physical Bullion Is Better for Long-Term Wealth Preservation
Holding physical bullion gives you direct control, while paper claims on metals are subject to a counterparty.
People who held physical silver dollars in the early 20th century still owned silver after the 1968 redemption cut-off, while certificate holders were left with only paper.
If you want to ensure access to precious metals, holding physical bullion is safer than relying on any other vehicle.
4. Legal Tender Laws Can Be Changed at Any Time
Governments can alter legal tender laws and force currency transitions.
The U.S. government made silver certificates obsolete by ending redemption and shifting to fiat currency.
Holding real assets outside the banking system can provide financial security in case of sudden legal changes.
Frequently Asked Questions
Silver certificates were a form of U.S. paper currency issued between 1878 and 1965, originally backed by and redeemable for silver dollars or bullion.
They circulated like regular paper money and could be exchanged for silver dollars until the U.S. government ended the redemption policy in 1968.
No, the U.S. Treasury no longer exchanges silver certificates for silver, but they remain legal tender and can be spent at face value.
While you cannot exchange them for silver, you can still use them as legal tender or sell them to collectors for a potentially higher value.
Yes, depending on the series, condition, and rarity, silver certificates can be worth more than their face value to collectors. Common notes may only be worth slightly more than face value, while rare ones can fetch significant sums.
You can sell them through coin and currency dealers, online marketplaces (eBay, Heritage Auctions), or at coin shows. Consulting a currency expert can help determine their value.
Conclusion
Silver certificates offer a fascinating glimpse into the evolving nature of money, from their origins as a silver-backed currency to their eventual transition into collectible artifacts.
Their history highlights key lessons about monetary policy, government intervention, and the enduring appeal of precious metals.
While no longer redeemable for silver, certificates remain a popular item among collectors, with some notes fetching significant premiums.
Whether as a historical curiosity or an investment opportunity, silver certificates serve as a reminder that the value of money is ultimately shaped by policy decisions, market forces, and public trust.
To your protection and prosperity,
Thomas
P.S. Have I left out anything important? Please let me know. Or if you found this information to be of high value, drop me a line, too. I love hearing from readers.
Sources
Silber, William L.. The Story of Silver : How the White Metal Shaped America and the Modern World. Princeton, New Jersey: Princeton University Press, 2021.
Image Credits
1878 Silver Certificate is in the public domain
1934 Silver Certificate is in the public domain
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