Dollar Sign

Frequently, Americans tend to think of the dollar sign as being their exclusive property. They believe that it means the American dollar, and nothing else. Nothing could be further from the truth. In fact, the dollar sign was not invented by Americans, was not originally used to denote an American dollar, and the symbol predates the founding of the United States of America.

The symbol "$" can be used to denote any dollar or peso unit throughout the world. It is so widely used that there is controversy over the sign's origin -- many different countries and cultures claim its creation.

The dollar sign originally denoted a Spanish-Mexican peso, more famously known as "pieces of eight." The Spanish dollar has its origins in the 15th century, and by the late 18th century it had become the first world currency. It was widely used in Europe, the Americas, and even the Orient.

One of the reasons for the coin's popularity was that it represented a regulated, government-minted currency. When freshly minted, each Spanish dollar contained the exact same amount of silver as every other Spanish dollar.

After gaining independence from Great Britain, the United States modeled its currency on the Spanish dollar, creating the American dollar. The Spanish dollar also served as the model for the Canadian dollar and the Chinese yuan. Even after the United States dollar was officially adopted in 1785, the Spanish dollar was the most popular form of currency in the United States.

It was particularly easy for Americans to come by Spanish dollars. The vast silver deposits discovered in the Spanish colonies of Mexico and Peru allowed for the minting of fresh coins in the colonies. It was not until the Coinage Act of 1857 that the Spanish dollar was finally officially removed from circulation in the United States. After Mexico gained its independence from Spain in 1821, it continued to mint coins modeled after the Spanish dollar, creating the Mexican peso.

The $ symbol most likely speaks to its Spanish origins. Many historians believe that the design comes from the Spanish coat of arms engraved on the Spanish dollar. Many others believe that $ came about as short hand for an abbreviation for peso. Still others contend that it is actually a composite of the letters "U" and "S" for United States.

While this theory makes sense on the surface, it loses most credibility once one realizes that the symbol was in use long before the creation of the United States as an independent nation. No matter the origin of the dollar sign, there is no doubt that it has been in use for centuries and is used throughout the world.