FINANCE
Why is the US currency called dollar? What is its origin and meaning?
The US dollar is the most widely used currency in the world. We explain everything you need to know about its origin, name and meaning.
The official currency in the United States is the dollar. This has become the most used currency in transactions that are carried out every day in global markets. Although this monetary unit has been part of the history of the American Union for generations, the origin of the word is much older than the very foundation of the country.
Why is the currency of the United States called the dollar?
The history of the dollar involves many countries from different continents. According to History, the word dollar is much older than the official US currency. ‘Dollar’ is an anglicized form of ‘thaler’ , the name given to coins first minted in 1519 from silver mined locally in Joachimsthal in Bohemia. Today the town of Jáchymov lies within the borders of the Czech Republic. ‘Thaler’ is a shortened form of ‘Joachimsthaler’, the original term of the coin.
The name of this coin was later shortened to 'taler' in German. Later, it became ‘daler’. By the mid-16th century, the English language had added daler to its vocabulary to name an increasing variety of coins from Europe, such as the Spanish dollar and the Portuguese eight-real piece.
Such coins circulated widely in the British North American colonies due to the scarcity of official British coins. Later, when the United States gained its independence, the dollar, subdivided into 100 cents, was chosen as the unit of currency, replacing the pound.
The dollar was formally adopted in 1792 in the new Coinage Act of Congress, which established the United States dollar as the country’s standard unit of currency. Thanks to this law, the US Mint was also created, in charge of producing and circulating the currency.
The origin of the dollar sign
There are many theories about the origin of the dollar sign, which began to be used after the year 1800. One of the most popular is that it derives from the initials of the United States. By superimposing a capital ‘U’ on top of a capital ‘S’ and removing the bottom of the ‘U’, you get a two-stroke version of the dollar sign.