EARLY MONEY OF CANADA

by Jim Trethewey

The story of the early money of Canada is a colorful story of improvisation.

The amount of actual coinage in the world increased dramatically throughout the 16th and 17th centuries due to the Spanish mints in the New World that controlled vast supplies of gold and silver, minted in the form of gold "doubloons" and the 8 Reales milled dollar. Even though Canada was relatively near these sources of currency (compared to the Old World), extremely little of it made its way to Canada; the bulk of it went to Europe and to trade with the Orient.

The earliest history of Canada (shared with that of the Pacific Northwest of the United States) is that of the fur trapper. The currency of the time was animal pelts, primarily beaver, and to a lesser extent, otter and silver fox. They were traded for goods at their intrinsic value; a "made beaver" (a single prepared skin) traded from an exchange rate of £10 in 1668 to £5 in 1772, £2 in 1812, £1 10/ in 1820, and £1 in 1827, where it essentially stayed from then on. The declining value is related directly to the number of trappers in business who increased the market supply of furs. The Hudson's Bay Company "bought" these furs from the trappers at the various Hudson Bay trading posts. After a batch of furs had been valued, tokens representing the total value would be placed on the counter. Then the trapper would select whatever goods he wanted to purchase, and the value of each would be indicated by the removal of the appropriate token(s) from the counter. In this way, buyers would know when they were out of money. These tokens were first made from lead in the denomination of 1 Made Beaver, and later from brass and aluminum in denominations of 1, 5, 10, 20, 25, and 50 Made Beaver. They very rarely left the trading post or were circulated.

The French colonists of Lower Canada (Quebec) initially used barter for all transactions, but as the population increased, the need for some form of currency became greater. Any available coinage of intrinsic value, such as gold and silver, was quickly exported to European traders that would only accept this form of payment for manufactured goods. From 1685 to 1763, playing cards were traded as money by local colonists. Essentially an IOU, the cards had written on them their value and the name of who would redeem them. A very limited supply of French coinage also circulated; most of this made its way back to Europe. An attempt was made to produce coinage in France expressly for use in Canada in the denomination of 1 Sou, with partial success.

Generally, the European governments were much less concerned about monetary shortages in the colonies than they were about having cash to pay their respective troops to promote the various wars being waged on the continent. So, when Canada became a wholly English colony in 1763, there was only a small influx of British coinage.

After the American Revolution, many of the British sympathisers moved from the United States to Canada (often because their real-estate was dispossessed). These colonists were accustomed to dealing in token coinage that circulated widely in the United States at that time. The merchants among them both imported this coinage and began minting their own. This as well as federal issues of the United States made their way into the coinage void in Canada. The latter had a profound effect. Even though Britian did not adopt a decimal monetary system until 1971, the first government-issue Canadian coinage became decimal.

Merchant token coinage was produced in bulk in Canada from 1812, primarily from copper in denominations of ½ penny and 1 penny. They were both produced locally and imported from private minters of England and Ireland. These tokens had a variety of interesting advertising or political slogans, such as: Encourage Country Importers, Fishery Rights for Newfoundland, Pure Copper Preferable to Paper, No Labour -- No Bread, Speed the Plough, Success to the Fishery, Prosperity to Canada, and Responsible Government & Free Trade. Many merchants also had more mundane nomenclature, such as: Gass’ Tea Store, Blakely & Co. Salt Goods Warehouse, and Robert Purvess Cheap Family Store. Most of these tokens can be obtained today for $15.00 each or less.

Local banks, especially the Bank of Montreal, Bank of Quebec, and Bank of Upper Canada (Ontario), produced copper ½ penny and 1 penny tokens from 1823.

Britain finally attempted to produce government-approved coinage for Canada in 1858. These coins were minted at the Royal Mint in London and bore the legend "Province of Canada" upon them. This attempt was only partially successful. Most colonists were particularly wary of the 1 cent piece, which was considerably lighter in weight than the bank tokens prevalent at the time. The other denominations were 5 cents, 10 cents, 20 cents, and 50 cents, all of silver.

At this time Newfoundland was considered a separate country (it entered confederation with Canada in 1949) and separate coinage was produced for it.

Canada obtained independence in 1867. The new government contracted with the Royal Mint in London to produce official coinage, the first large shipments of which arrived in 1870. The donominations produced were 1 cent, 5 cents, 10 cents, 25 cents (shifting away from the 20 cent piece due to the influence of United States coinage), and 50 cents. These were in sufficient supply to finally replace most of the non-government currency.

References:

[1] Standard Catalogue of Canadian Coins, Tokens, and Paper Money, Thirteenth Edition. Charlton, J. E. Whitman Publishing Company, Racine, Wisconsin, 1964. pp. 4-5.

[2] The Conquest of the Great Northwest; being the story of the adventurers of England known as the Hudson's Bay Company. Laut, Agnes C. Moffat & Yard, New York, New York, 1908.

[3] Since the Days of Barter. Nichols, Peter. The Numismatist, Colorado Springs, Colorado, December 1968. pp. 1569-1574.

[4] Striking Impressions. Haxby, James A. The Royal Canadian Mint, Ottowa, Onatario, Canada, 1983. pp. 27-36.


Copyright © 1993, The Willamette Coin Club. All Rights Reserved.