Minted for use in the Spanish Empire from 1497, the Spanish dollar coin was a highly influential coin.
Worth eight reales, it was sometimes physically cut into eight pieces, hence the phrase 'pieces of eight'. The coin was the inspiration for the US dollar, which is why a quarter dollar is sometimes known as 'two bits', and the Chinese yuan.
And a particularly unusual use for the coins was found in two British colonies around the turn of the 18th to 19th centuries, and sprung from a lack of consistency in the value of the coins in Canada.
Although in use all over Eastern Canada, the coins were known to be valued highest in Halifax. Crafty merchants therefore travelled and traded and sent all the Spanish dollars they could get hold of to Halifax to make a quick buck. This led to a shortage of coins elsewhere.
The governor of Prince Edward Island became so frustrated at this that he took it out on the coins: collecting all the Spanish Dollars he could, he had the centres punched out of them. Both the centre and rim of every coin was stamped with a starburst.
The coins were no longer accepted outside the island, but were passed as shilling and five shilling pieces respectively there and became the island's official currency.
Abusing coins in this way proved an inspiration to Governor Lachlan Macquarie of New South Wales, Australia which had suffered from currency shortages since its creation in 1788. In 1812, 40,000 Spanish dollars had their centres stamped out.
These were given further markings with the centres (known as 'dumps') stamped with a crown on the obverse and the denomination of 15 pence on the reverse whilst the rims (now known as 'holey dollars') were stamped around the hole with 'New South Wales 1813' on the obverse and 'Five Shillings' on the reverse.
Two 1813 Australian Holey Dollars are heading Noble Numismatic Pty's current auction in Melbourne with estimates of up to A$120,000. These are exceptional prices, but the coins were Australia's first native currency and 1813 pieces in good condition are rare.
Macquarie's policy is probably one of very few times in numismatic history when mutilating fine coins has increased their value.
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