From the Coinage Act to the Coinage App: It’s Time to Upgrade Your Money

Here’s something they don’t really teach you in school. For the first 16 years after the Declaration of Independence, the United States had no national currency. No dollar. No coins. Nothing.

A brand new country, trying to build an economy, and people were paying for things with tobacco. I’m not being metaphorical. In Virginia, tobacco was legal currency for nearly 200 years. Government officials were paid in tobacco. Taxes were paid in tobacco. In Massachusetts, they used wampum, polished shell beads. In the Carolinas, rice was money. Elsewhere, people used beaver pelts, corn, nails, and sugar.

And then there were the coins. Not American coins, because those didn’t exist. Americans used Spanish dollars, British shillings, Dutch guilders, French livres, all at the same time, all worth different amounts depending on which state you were standing in. The same Spanish coin was worth 6 shillings in Boston and 32 shillings in Charleston. Imagine trying to run a business where the same coin has five different values depending on where your customer lives.

Then it got worse. When the Revolutionary War started, the Continental Congress needed to fund an army. They had no power to tax, so they did what governments always do when they need money they don’t have. They printed it. By the end of the war, they had printed $241 million in paper bills backed by absolutely nothing.

By 1781, $100 in Continental bills bought what $1 in silver could. George Washington himself said a wagon load of money wouldn’t buy a wagon load of provisions. Barbers wallpapered their shops with the worthless bills as a joke. Sailors stitched suits out of them and paraded through the streets. When soldiers were discharged, they received back pay in Continentals so worthless that speculators waited at the camp gates offering pennies on the dollar. And the veterans sold, because they needed real coins to buy food on the walk home.

The phrase “not worth a Continental” became America’s first expression of total financial disillusionment.

The Coinage Act wasn’t just a law about coins. It was a philosophical statement about what money owes to the people who use it.

Alexander Hamilton, the first Secretary of the Treasury, designed the blueprint. He had served as Washington’s chief aide during the Revolution and watched the Continental Army nearly collapse, not from the British, but from the money. Soldiers went unpaid for months because the currency they were owed couldn’t buy anything. The Continental Congress kept printing bills it couldn’t back, and the resulting collapse hollowed out the war effort from the inside. Hamilton saw, firsthand, what happens when money breaks. The damage doesn’t stay in the financial system. It flows into every life that depends on that money. And that’s everyone.

In January 1791, Hamilton submitted his Report on the Establishment of a Mint to Congress. He described “the immense disorder which actually reigns in so delicate and important a concern.” But the report wasn’t just about fixing a broken system. It was about defining what money is supposed to do.

Hamilton argued that the most important principle in all of economics is the “uniform preservation of the intrinsic value of the money unit.” Because on this, he wrote, “the security and steady value of property essentially depend.”

I think about that line constantly. He was saying something that sounds obvious but has radical implications. When money loses its value, every contract written in that money becomes a partial lie. Every wage is a broken promise. Every savings account is a slow betrayal. The landlord who agreed to rent at a certain price, the worker who agreed to labor for a certain wage, the family that saved a certain amount for their children’s future, all of them made decisions based on the assumption that a dollar today would be roughly a dollar tomorrow. When that assumption is violated, it’s not just an economic inconvenience. It’s a breach of trust between a government and its people.

This is what made Hamilton’s thinking so different from how we think about money today. We’ve been trained to see inflation as a normal, even healthy feature of the economy. Central banks target 2% inflation as policy. We accept that prices go up every year. Hamilton would have found this insane. His entire framework was built on the conviction that the money unit must be stable, because without that stability, no economic relationship can be honest.

He also understood something else that I think gets overlooked. Money is not neutral. It doesn’t affect everyone equally. Hamilton specifically argued for small-denomination coins to help working people, writing that they are “a great accommodation” because they enable people “to purchase, in small portions, and at a more reasonable rate, the necessaries of which they stand in need.” He understood that when money is unstable or inaccessible, it’s the people with the least margin who get hurt the most. The merchant with diversified assets can hedge. The family living paycheck to paycheck cannot. Bad money is a regressive tax. It takes the most from the people who have the least.

On April 2, 1792, Washington signed the Coinage Act into law. The Act created the U.S. Mint in Philadelphia, the first federal building erected under the Constitution. It established the dollar, a decimal currency system, and defined precisely how much silver and gold went into each coin. Every coin had to carry the word “LIBERTY” on its face. Congress rejected the idea of putting Washington’s portrait on the coins because it felt too much like a monarchy. The first coins, roughly 1,500 silver half dismes, were struck in July 1792 in the cellar of a Philadelphia saw-maker because the Mint building wasn’t finished yet.

And then there was Section 19. If any Mint officer debased the coinage, if they reduced the weight or purity of the coins for personal gain, they would be guilty of a felony punishable by death.

Nobody was ever executed under this provision. Its power was philosophical. In English common law, debasement had been classified alongside treason. The Coinage Act inherited that tradition. The founders were saying: the integrity of money is foundational to the integrity of the republic. If the government cannot be trusted with the value of its currency, it cannot be trusted with anything. They had just lived through the total destruction of the Continental dollar. They had seen what happens when a government treats its currency as disposable. And they wrote into law, with the harshest penalty available, that this must never happen again.

There’s one more piece of Hamilton’s thinking that connects directly to what’s happening now. Four months before the Coinage Act was signed, Hamilton submitted his Report on a National Bank. In it, he called gold and silver sitting idle “dead stock.” Money that is not put to productive use, he argued, produces nothing. But when deployed into something productive, it “acquires life” and becomes an “active and productive quality.” He drew this idea from Adam Smith, who argued that ready money sitting unemployed is “so much dead stock which produces nothing.”

Hamilton was making a case about banking, but the principle is universal. Money that sits still is money that dies. Capital must be in motion, must be productive, must be generating value. The worst thing you can do with money is let it do nothing.

The Coinage Act was a technology upgrade. It took America from monetary chaos to monetary order. It was the right solution for 1792. It was also the last time America fundamentally upgraded what money is.

Everything since has been a modification to how money is managed, not a rethinking of what money should be. And the modifications have consistently moved in one direction: away from Hamilton’s principle.

In 1913, the Federal Reserve was created. Since then, the dollar has lost approximately 97% of its value. What cost $1 in 1913 costs about $32 today. That’s the Consumer Price Index, tracked by the Federal Reserve Bank of Minneapolis.

In 1933, Roosevelt required citizens to hand their gold to the Federal Reserve at $20.67 per ounce, then immediately revalued gold to $35. A 41% devaluation overnight. In 1971, Nixon ended the dollar’s convertibility to gold entirely. He called it temporary. The gold window never reopened. Gold has since gone from $35 to over $3,000 per ounce. That’s not gold going up. That’s the dollar going down.

Then came modern money printing. After 2008, the Federal Reserve expanded its balance sheet from $850 billion to $4.5 trillion. During COVID, the M2 money supply surged from $15.4 trillion to $21.7 trillion in roughly two years. Something like 20 to 25% of all dollars in existence were created after January 2020. Inflation hit 8% in 2022, a 40-year high.

Hamilton warned about this in 1790. He wrote that issuing unfunded paper currency “is calculated to produce great mischiefs in the long run.” The long run arrived.

Here’s the part that makes me a little emotional, honestly.

The average checking account pays 0.07% interest. Inflation runs at about 2.4%. If you have $10,000 in a checking account, you earn $7 a year in interest while losing roughly $240 in purchasing power. A net loss of $233 every year. Over a decade, more than 20% of your money’s buying power disappears. You still see the same number in your account. But what it can buy quietly shrinks.

Economists call this financial repression. When governments carry enormous debts (U.S. national debt: over $38 trillion, about 124% of GDP), keeping interest rates below inflation slowly erodes the real value of that debt. Researchers Carmen Reinhart and M. Belen Sbrancia documented this for the IMF. It functions as a 1 to 2% annual stealth tax on anyone holding cash. After World War II, this mechanism brought the U.S. debt-to-GDP ratio from 106% to 23%. The cost was paid by every saver in the country.

The founding generation made currency debasement a death penalty offense. Today the debasement is structural. And your checking account is exactly what Hamilton warned about. Dead stock. Money sitting idle, producing nothing, quietly losing its value every single day.

In the entire history of the S&P 500, across every 20-year rolling period, returns have never been negative. Not once. Not during the Great Depression. Not through World War II. Not through the dot-com crash. Not through 2008. Not through COVID. The average annual return over nearly a century is about 10% before inflation, roughly 7% after.

$10,000 in a broad market index fund, left for 20 years, would have historically grown to approximately $67,000. The same $10,000 in a checking account would be about $10,141 nominally, but only worth about $6,200 in real purchasing power.

NYU professor Aswath Damodaran compiled asset class returns since 1928. Over that span, $1 in stocks grew to approximately $749 in inflation-adjusted terms. The same dollar in Treasury bills grew to $1.33. Stocks outperformed cash 563 to 1.

When you own an index fund, you own a piece of nearly every major business in the country. Their products, employees, customers, innovation. Every quarter, these companies report their numbers publicly. If the CEO is destroying value, the board removes them. If the company stops growing, capital moves somewhere better. The feedback loop is immediate in a way that government monetary policy never is.

Cash is a claim on nothing except a government’s promise. That promise has been broken, slowly and consistently, for over a century.

Money is not a fixed thing. It’s a technology. And like all technologies, it gets upgraded when the current version stops working and something better becomes possible.

Barter broke down at scale. Commodity money (salt, cattle, shells) solved that but spoiled and was hard to transport. Metal coins solved portability but were heavy for large transactions. Paper money solved weight but introduced the fatal temptation to print. Fiat currency, untethered from gold after 1971, gave governments maximum flexibility while removing every natural constraint on creation.

Each upgrade solved the biggest problem of the previous version. Each introduced a new one. So what is fiat currency’s biggest unsolved problem?

It fails at the one thing Hamilton said matters most. It doesn’t store value. Central banks explicitly target 2% inflation, meaning cash is designed to lose half its purchasing power roughly every 35 years.

In 1970, Fischer Black published a paper imagining a world where people held financial assets instead of dollars. Eugene Fama extended the idea. Economists Tyler Cowen and Alex Tabarrok recently revisited this framework. Tabarrok’s description is simple: imagine people hold financial assets in their accounts instead of dollars, and when they buy something, they transfer the equivalent value in assets. Neither buyer nor seller actually wants to hold dollars that don’t earn anything.

What made this impractical in the 1980s was technology. Selling a stock took days. Commissions were expensive. You couldn’t buy $3 worth of an index fund. Today, fractional shares let you invest as little as $1. Commission-free trading is standard. Settlement is moving toward real-time. The wall between “money” and “investments” is dissolving.

This is why I built Coinage. And why I named it what I named it.

The Coinage Act of 1792 upgraded America from monetary chaos to monetary order, backed by real metal and protected by the death penalty. The founders could not have imagined a world where the government itself would become the debaser, not through criminal fraud at the Mint, but through the legal, systematic expansion of the money supply.

Coinage the app is built on the same foundational principle: your money should hold its value. You connect your existing brokerage account, whether that’s Robinhood, Webull, or Public. You build a portfolio (we call them Nests) or follow one that someone you trust has already created. You set rules for when and how you want to sell. And when you spend on your credit card, Coinage can sell your gains to offset the cost, but only when you’re in profit, only at whatever threshold you set.

I’m not saying dump your checking account into the market tomorrow. The 70 to 80% you need for bills should stay liquid. But that other 20 to 30% sitting idle, quietly losing value every year? That money should have a job. It should be in diversified ETFs, compounding, earning dividends, growing. And when you need it, the system should make selling seamless and unemotional.

I didn’t build this to make people millionaires. I built it because the system most people use to hold their money is broken, and the alternative is right there, accessible to everyone.

The Uber driver. The warehouse worker. The single parent with $50 left at the end of the month. If that $50 goes into a diversified dividend ETF every week instead of a checking account, in five years it’s worth more. In ten years it’s throwing off passive income. Not life-changing money. But a little bit better. A slightly less stressful month.

I think about the people working hard and saving the right way, doing everything they were told to do, and still falling behind. Not because they’re doing something wrong. Because the currency they’re saving in is slowly being devalued by a system that was never designed to protect them.

Hamilton understood this. He designed a system to prevent it. That system didn’t hold. But his principle still stands.

The next upgrade doesn’t require a new currency. It doesn’t require crypto or blockchain or anything exotic. It requires a new default container for savings. Instead of holding dollars that lose value, hold a diversified portfolio of productive assets that have historically grown. Use technology to make the conversion between investments and spending seamless and invisible.

From the Coinage Act to the Coinage app. From dead stock to living capital. From a container that leaks to one that grows. It’s time to upgrade your money.