Canadian Currency from the 16th Century to 1867
The evolution of early Canadian currency offers a unique perspective into the growth of Canada as it was evolving into a nation. From it’s pre-colonial origins, to the tokens ushered in by Confederation in 1867, currency saw many forms and many uses.
Early 16th Century- First Nations and Wampum
As Canada was being settled, coins from Europe were scarce and far between. Interactions with the First Nations led to strong trade systems through the bartering of goods such as furs, wampum, copper objects, tools, and beads.
Wampum was highly valued among the Aboriginals not only for the time and difficulty of creating wampum shell beads, but the ceremonial functions of both the beads and the wampum belt. Wampum most importantly conveys messages, mark peace treaties, and record historical events using marks of friendship and respect. To early European traders, beads were essential to the fur trade since they were small and high value. Europeans used the beads to trade for pelts to cover the high demand for fashionable furs in Europe.
17th Century- French Coins and Playing Cards?
By 1608, Samuel de Champlain founded the first colonial settlement in Quebec. Bartering was still the main method of currency until settlements expanded and coins from France took over. These coins were higher value to the colonists in North America due to the risks of transporting gold and silver by ship across the Atlantic. By 1670 as result of illegal trading with settlers to the south, Spanish dollars (piastres) also worked their way into the colonies.
Because of the illegal trading and increased military expeditions waged against the Iroquois, fur trade started to dwindle and money fell short. Payment of soldiers could no longer be postponed and the first issue of card money using playing cards was issued June 8th, 1685 with the currency value written on the back of the card. It was not long until counterfeiting and sharp rises in inflation as result of social and political unrest resulted in eventual ban of card money in 1720.
18th Century and Beyond
With the failure to find a replacement after the ban of card money and onset of an immediate recession, the country transitioned through various types of coin and paper currency with it’s value being directly impacted by social and political reforms or war (such as the Great War between Great Britain and France).
Under a British colonial rule in North America, the government was unable to solve the coin shortage and colonists still depended on the fur trade and coins from England. With rising trade between British Colonists and the future colonists settling in the U.S, coins from across all of Europe and the Spanish Colonies of Latin America became the norm. Colonists independently regulated the currency by creating ‘ratings’ or value on the coins. Once they were rated, they became legal tender. It wasn’t until the War of 1812 that paper bills made a comeback in order to finance the war effort. When the war ended in 1815, the British government redeemed the military bills at full value. The renewed interest in paper currency lead to the first bank, Montreal Bank (later changed to the Bank of Montreal) to be opened in 1817, issuing money in dollars. The rise of banks solved the problems associated with foreign currency in circulation with different ‘ratings’.
By the 1840’s Political Union in Upper and Lower Canada created the Province of Canada which led to a currency reform. By 1857 the currency changed to 1, 5, 20, and 50 cent denominations with the first Canadian coinage authorized in 1858.
The sweeping changes of Confederation in 1867 ushered in a responsibility for the government to legalize it’s own currency. Ottawa issued a new series of coin denominations; 1, 5, 10, 25, and 50 cent coins which were legal in the four provinces that signed the confederation act.
Powell, James. A History of the Canadian Dollar. Ottawa: Public Works, 2005.
“The Royal Canadian Mint Currency Timeline.” Royal Canadian Mint. https://www.mint.ca/store/dyn/PDFs/RollTimeline_e.pdf.