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U.S. Mint vs. Liberty Dollar

The U.S. Mint issued a press release a few days ago that has probably made the Liberty Dollar folks very happy. This is the kind of advertisement that money cannot buy. It's also a milestone for the Liberty Dollar program — they're big enough now that the U.S. government is beginning to feel threatened.

Threatened enough to claim that it is a crime to use the Liberty Dollar:

NORFEDs "Liberty Dollar" medallions are specifically marketed to be used as current money in order to limit reliance on, and to compete with the circulating coinage of the United States. Consequently, prosecutors with the United States Department of Justice have concluded that the use of NORFEDs "Liberty Dollar" medallions violates 18 U.S.C. § 486, and is a crime. [source]

For your reference, this is 18USC§486:

Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title or imprisoned not more than five years, or both.

While it may look frightening, it's irrelevant, and the typically overzealous Department of Justice is overreaching. Even the casual hobbyist coin collector quickly learns that numismatics can be strict about its definitions. The word "coin" can only be used to refer to government-issued round shiny things. Privately minted round shiny things are called medallions, tokens, disks, rounds, or (yes) round shiny things.

The Northwest Territorial Mint (a private mint I've visited) has a glossary that backs this up. Even the U.S. Mint's FAQ page will, if you search for the word "coin", define it as a "flat piece of metal issued by the government as money." (See entry #115 on the search results page.)

If this weren't damning enough, the U.S. Mint's own press release consistently refers to the Liberty Dollar round shiny things as "medallions", reserving the word "coin" to refer to U.S. Government coins.

Furthermore, private mints have a prominent and interesting history in this country, especially during the California gold rush, when many created round shiny things in clear imitation of official government coins and even continued to operate alongside the U.S. Mint's San Francisco branch when it opened.

I've been unable to locate an authoritative online legal definition of "current money" but I suspect it may mean money declared to be legal tender. (This section of the U.S. Code is about counterfeiting.) If true, the Liberty Dollar is also fine because it does not claim to be legal tender. The law here is making it illegal to offer something as a legal tender when it isn't.

Full disclosure. I own a few Liberty Dollar round shiny things as a collector, from both before and after their switch from a $10 base to a $20 base. I have some misgivings about the Liberty Dollar but I completely endorse their disapproval of central banks and fiat money.

I'm much more comfortable endorsing the Phoenix Dollar because they aren't attempting to create a fixed exchange rate between their currency and U.S. currency.

Tiny Island