In my first post I used the following image showing the ridges on the edges of quarters.
Ridges help you recognize if your coins have been clipped or not
The ridges we see on modern coins (called reeded or milled edges) and other higher-denomination coins are a direct anti-theft technology invented centuries ago to fight the problem of coin clipping.
The Core Problem It Solved
Historically, gold and silver coins were valuable because of their metal content, not just the government's stamp. Each coin was supposed to weigh a certain amount and therefore be a certain size according to the molds used to make the coins.
People (and sometimes rulers) would shave or file tiny amounts of precious metal from the smooth edges of coins. The altered coin still looked mostly normal and could be spent at full face value, while the thief collected the shavings to melt down and sell or reuse. Over time, this debased the currency supply. Coins lost weight and real value, yet circulated as if they hadn't.
This practice became rampant in 17th-century England. By the 1690s, a huge portion of circulating silver coins were underweight due to clipping, contributing to economic chaos. Full-weight "good" coins were hoarded or exported, while clipped "bad" ones dominated trade (classic Gresham's Law in action).
Rome had this problem in a major way
I also mentioned how Diocletion tried to fix inflation by restoring coins back to full weight, and while it did help somewhat, he didn’t go far enough. There were too many debased coins out in circulation to curb the issue.
Reeded Edges
To make clipping obvious and unprofitable, mints began adding narrow ridges (reeds) around the edge during the striking process. This was done with early machinery, such as a Castaing machine or collar dies.
If someone tried to shave the edge, the ridges would be damaged or partially removed, leaving a smooth or uneven section.
Merchants and users could quickly spot a tampered coin and refuse it, or demand it be weighed.
The innovation is often linked to England's Great Recoinage of 1696, when the Royal Mint (under Isaac Newton as Warden, later Master) recalled millions of old hammered silver coins, melted them, and reissued new machine-struck coins with milled/reeded edges. This helped restore trust in the currency. Similar techniques had appeared earlier (e.g., some edge lettering in the 1660s), but Newton and the recoinage scaled and standardized it effectively.
How This Carried Over to U.S. Quarters
When the United States Mint began operations in the 1790s (following the Coinage Act of 1792), it adopted the same security feature for coins made of precious metals:
Silver coins like dimes, quarters, half dollars (and gold coins) got reeded edges right from the start.
Lower-value coins like pennies and nickels (copper or base metal) did not, because their metal wasn't valuable enough to make clipping worthwhile.
U.S. quarters were originally 90% silver until the Coinage Act of 1965, when the U.S. shifted to copper-nickel clad composition to save costs as silver prices rose. Clipping is no longer a realistic threat (the metal inside isn't worth the effort or legal risk), but the ridges stayed:
Changing the minting equipment/dies would have been expensive and unnecessary.
They now serve secondary purposes: helping visually impaired people distinguish quarters from nickels by touch, and maintaining tradition/security against counterfeiting.
Today, a standard U.S. quarter has 119 ridges on its edge. The feature persists on dimes, quarters, half-dollars, and dollars, but not on nickels and the newly discontinued pennies.
The Problem with Gold and Silver
Gold and silver as money suffer from three core physical limitations that have plagued every historical attempt to use them as a reliable medium of exchange:
hard to transport
hard to verify
tendency to become centralized
These flaws directly created the incentive for coin clipping, which in turn accelerates centralization and ultimately undermined the very “sound money” properties gold and silver were supposed to deliver.
1. Hard to Transport (Portability Problem)
Gold and silver have high value per unit of weight, but only up to a point. For everyday commerce or large-value transfers, the metal is cumbersome and risky:
A single ounce of gold (≈ $4,886 today) is tiny, but moving $1 million in physical gold requires roughly 14 pounds of dead weight that must be guarded, insured, and physically hauled.
Historically, merchants and travelers faced banditry, shipwrecks, and customs checkpoints. This is why large-scale trade quickly moved away from actual metal and toward paper claims on metal stored in distant vaults (early banknotes, bills of exchange).
The physical bulk created a natural pressure toward centralized storage. You don’t want to carry it, so you trust someone else to hold it for you, so instead you transfer title of the gold in a bank safe vault via paper IOU’s.
2. Hard to Verify (Authenticity & Weight Problem)
Even if you solve transport by using coins, you still face the verification nightmare:
You must confirm both purity (is it really gold/silver, or alloyed with cheaper metal?) and full weight (has any metal been removed?).
Simple tools like touchstones or scales existed, but they were slow, imprecise, and often required damaging the coin. In busy marketplaces, most people simply trusted the coin’s appearance and the reputation of the issuer.
This trust gap is exactly what made coin clipping possible and profitable.
3. Coin Clipping: The Direct Consequence of Verification Failure
Coin clipping was the predictable market response to the verification problem. People (and sometimes governments) would:
Shave or file tiny slivers of gold or silver from the edges of coins.
Pass the now-lightened coin at full face value.
Melt the clippings into new coins or bullion and repeat.
Because the coin still looked normal and still carried the official stamp, recipients had no easy way to detect the theft. The practice became so widespread that:
By the 17th century in England, an estimated 20–50 % of circulating silver coins were underweight due to clipping.
Isaac Newton, as Warden (and later Master) of the Royal Mint, spent years fighting it. The 1696 Great Recoinage was a direct emergency response: all clipped coins were called in, melted, and reissued.
Gresham’s Law (“bad money drives out good”) kicked in with a vengeance and full-weight coins were hoarded or exported, while clipped “bad” coins dominated daily trade.
Clipping was not a fringe crime; it was a rational response to the physical limitations of the money itself. The metal was valuable, the verification cost was high, and the punishment risk was low.
How Clipping Forced Centralization
The only practical way to stop widespread clipping was to centralize control over coin production and verification:
Governments monopolized minting (private mints were outlawed or heavily regulated).
Coins received reeded (milled) edges so any clipping would be immediately visible. This is literally the invention of the ridges you still see on modern quarters.
Official seals, complex designs, and state punishment became necessary to maintain trust.
But centralization created a new, far more dangerous problem: the state itself became the biggest clipper. Rulers discovered they could officially debase the currency (reduce the metal content while keeping the face value the same) and reap massive seigniorage profits. Roman emperors, medieval kings, and later European monarchs all did exactly this. The physical flaws of gold and silver (transport difficulty, verification difficulty) made centralization inevitable, and once centralized, the money became easy to debase.
The Vicious Cycle
Gold and silver’s physical properties make them hard to move and hard to verify → this creates the incentive and opportunity for clipping → clipping destroys trust → only a central authority can restore trust → that central authority gains the power (and temptation) to debase the currency at scale.
This is why every historical gold/silver standard eventually either collapsed into debasement, shifted to fractional-reserve banking (another form of hidden clipping), or required ever-more-intrusive government enforcement. The metal itself contains the seeds of its own centralization and corruption.
These are precisely the problems a well-designed digital money like Bitcoin can solve: perfect portability (a private key weighs nothing), instant and non-destructive verification (cryptographic proof), and no trusted third party required to prevent clipping or debasement. The historical record of coin clipping isn’t just an interesting footnote. It’s the clearest proof that gold and silver were never “perfect” money; they were simply the best technology available until something better came along.
In the next post we will explore how gold, silver, dollars and Bitcoin affect the financing of conflict, and why we’ve been in a century of forever wars since the creation of the Federal Reserve.