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The only fractional gold pieces for which evidence exists of actual contemporary use are those of Period One, and these issues are the ones most highly sought by collectors of pioneer gold coins. It must be remembered that the San Francisco branch of the United States Mint didn’t get up to full production until 1856, and before that time commerce was handicapped by a lack of adequate coinage. In the early years of the California Gold Rush, small payments were made in “pinches” of gold dust, a flawed system at best. The government was of little help, as it mandated that the federal assay office established in 1851 could coin nothing smaller than a fifty dollar “ingot.” While this restriction was lifted the following year, the smallest denomination then being coined was the eagle, or ten-dollar piece.
Private banking and assaying firms stepped in to supply additional coins from 1849 to 1851, but their lowest issues were valued at five dollars, and the demand for small coins remained. Beginning in 1852, this need was met by a handful of jewelers in San Francisco, who began striking small gold pieces valued at one dollar, one half dollar and one quarter dollar. Though the intrinsic values of these coins fluctuated somewhat, they were usually close enough that the inflated boom economy of California neutralized whatever slight loss may have been suffered by those accepting them in trade. Their advantages simply outweighed their disadvantages, and the coins appear to have gained acceptance, as quite a number survive in worn condition.
There is scant documentary evidence of actual circulation, yet these small coins have been found in shipwrecks of the time period, and one was even featured in an 1852 newspaper account from New Orleans: “We were shown this morning a gold half dollar, California money, which is so much like the United States gold dollar piece, that the best judges would be completely deceived at a first glance. The half dollar piece is lighter in color, and somewhat smaller in diameter, than the dollar. They are of a private issue, and have stamped on them, HALF-DOLLAR CALIFORNIA GOLD 1852.” The lighter color of these coins is the result of their native California bullion, which is rich in silver.
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