Only weeks after Canada announced that their penny will be removed from circulation, a penny has stepped up to prove just how valuable one cent can be. Heritage Auctions has sold a 1792 one-cent coin for $1.15 million dollars. Of course, there are billions of modern pennies in circulation, while the penny sold at auction, an experimental strike for the fledgling nation, is far less common.
The full, technical name of the penny that was sold is “1792 P1C One Cent, Judd-1, Pollock-1, High R.6, MS61 Brown PCGS”, but more commonly this coin is known as a 1792 silver-center penny. As we’ve discussed quite often before, specie currency was the norm at the time, when money was valued based on its weight in precious metals rather than an explicit face-value. So, coins were made from metals of varying value, from gold to silver to copper or bronze, from most to least valuable.
As the U.S. was planning out how to be a real nation, the subject of minting money was an early objective. The government set the weight of a solid-copper penny at 11 pennyweight, a little over 17 grams. For comparison, a modern-day penny weighs 2.5 grams. At 8 grams a cubic centimeter, the 2-cubic-centimeter, 11 pennyweight penny that the U.S. government wanted to mint would be a huge coin, about the size of an Eisenhower dollar, incongruously larger than coins of much greater value. Alexander Hamilton, Secretary of the Treasury, was adamant that a penny be included to promote low-value sales to help the poor, so skipping a penny wasn’t an option.
Mixing in a more-valuable metal with the copper to bring down the weight wasn’t a reasonable option: billon alloys looked so much like copper that a penny half the size made of an alloy could be forged with ½-cent of copper and look the same. Secretary of State Thomas Jefferson came up with a remarkable idea: two metals could be used, but they wouldn’t be mixed, so the coin’s value could be visually determined. Using a tiny ¾-cent plug of silver, mounted in the center of a coin made from ¼-cent worth of copper, the coin would be a manageable size and still have the right value in precious metals.
Bi-metal coins were a new idea at the time, and have been tried many times since, until the euro made bimetallic coins a regular sight in people’s pockets. The nascent U.S. Mint was charged with producing the new coin and a small run of example pressings were made. Although the technology was able to produce the silver-center pennies, the process was complicated and labor-intensive, so it was decided to abandon the silver-center penny for a more traditional coin. The next year the weight of the penny was reduced by 20% and was minted in solid copper, at a little larger than a Kennedy half-dollar today. These “Large Cents” lasted until the Civil War, after which the modern penny took shape.
Only 14 of the silver-center pennies are known to exist today. The last time this particular coin from April 19th auction was sold was in 1974, realizing $105,000. A different silver-center penny, not nearly in as good a condition, sold in 2009 for $253,000, while another in poor condition was bought for $400 at a police auction that same year.