Uncovering America's Heritage... Coin by Coin
1866 Shield Type Nickel Five-Cent Coin
As surely as my name is Inspector Collector, Spring will soon turn into Summer. But my snooping...I mean, inspecting...has turned up another major change: a coin changed from a half-dime into a nickel!
You see, in the early days of American money, there was no nickel, only a half-dime. Actually, dime was spelled "disme," but pronounced the same. Why was it called a disme, you ask? It's from an old French word based on the Latin word "decimus" and means simply "a tenth"—a good name for a tenth of a dollar.
The first American half-dime, struck in 1792, was made of silver. So the first five-cent coin wasn't a nickel—it was a half-dime. And it didn't have any nickel in it, the way today's "nickels" do. Not only that, but the first coin made with nickel was a penny, and people even called them "nickels" or "nicks"! ...But even today's nickels are only 25 percent nickel—the rest is copper. That's because nickel is so hard that a coin can break the die that stamps it if the coin has too much nickel in it.
In 1866, the Civil War had just ended and many coins had disappeared because people were saving them. What a good time for Joseph Wharton to show up with his nickel mine! Nickel had been used in pennies and three-cent coins, but Wharton got Congress to pass an Act that created a new five-cent coin out of nickel. Congress passed the Act in the merry month of May.
Some called the new coin "the ugliest of all known coins." Even Wharton, who supplied the nickel for the coin, thought the shield in the coin's design looked like a tombstone. But people were eager to get rid of paper nickels—five-cent notes that were used as emergency money during the war.
They also found the five-cent pieces easier to use than the tiny little half-dimes. Can you imagine a coin being half the size of a dime? Nickels could be larger than half-dimes because copper and nickel aren't as expensive as silver. And that's why nickels are bigger than dimes today!