Dollar Day is observed every year on August 8, to commemorate the day Congress established the U.S. monetary system in 1786.
On that day, Congress set the value of what various coins would be, and what metallic makeup they would have. The value of a gold piece was set at $10, and the silver at $1. The value of other silver pieces was set at one-tenth of $1, while the value of copper pennies at one-hundredth of $1.
Today is National Dollar Day, which commemorates the day in 1786 when United States Congress established the dollar as the official unit of account for the federal government.
The founding fathers’ choice of a base-10 monetary system was a surprising change and a statement on the new nation’s identity. In 1786, American colonists still used Spanish dollars and British pounds. The U.S. dollar was created soon after in 1792.
The British pence and shilling system was essentially predicated on base 12: 12 pence make a shilling and so forth. And the Spanish system was base 8. A major decision was which one to follow.
They adopted a system that was completely new, namely that was a base 10 system, where 10 cents make a dime, 10 dimes make a dollar and so forth. I think the founding fathers thought that if we were really going to be an independent entity and be taken seriously, we needed our own identity. And so they chose the system that was dissimilar to anything at the time.
The transition to, and success of, the U.S. dollar was slower and less certain than most scholars have thought. Nothing in Congress’ dollar declaration had any force on market participants. Citizens could use whatever money and price in whatever unit of account they desired. Labor contracts recorded in the Philadelphia region during these years and found that employers used state paper money units of account almost exclusively until 1794. These state monies were expressed in pounds, shillings, and pence. Between 1794 and 1802, pricing switched to U.S. dollars.
The phrase “not worth a Continental” is coined after the Continental Congress issues paper currency to finance the Revolutionary War, currency that quickly loses its value because of a lack of solid backing and the rise of counterfeiting.
The United States officially adopts the dollar sign in 1785. The symbol evolves from the Spanish American figure for pesos.