Three Cent Nickels (1865–1889)

Shinplasters, Wharton, and an All-Night Session

By the winter of 1864 to 1865, American commerce was running on improvised substitutes that nobody liked. Gold and silver had vanished from circulation years earlier. The copper-nickel cents, Flying Eagle and Indian Head, had been hoarded too, selling at a small premium in 1862 and 1863 even though their metal was worth less than a cent. Even the new bronze two-cent pieces of 1864 had not yet accumulated in quantity. The gap was filled by fractional paper currency: small slips of three, five, ten, twenty-five, and fifty cents that became ragged and filthy in pocket use, were easily lost or torn, and that the public dismissed as "shinplasters." Congress had been issuing them as emergency measures since 1862, and the public disliked them from the first issue.

The case for a copper-nickel three-cent piece was straightforward. Its metal would be worth well below face value, so there would be no profit in melting it. It would retire the shinplasters from commerce. The driving force behind the bill was Pennsylvania industrialist Joseph Wharton, whose mine at Gap, Pennsylvania, and refinery at Camden, New Jersey, were the Mint's domestic source of nickel, and whose interest in government coin contracts was entirely unsentimental. Wharton identified Representative John A. Kasson of Iowa as the key legislative obstacle: Kasson, who chaired the House Committee on Coinage, Weights and Measures, had been one of the most vocal opponents of nickel in American coinage. Wharton's supporters pressed Kasson until he accepted that a coin of 25 percent nickel was preferable to another issue of three-cent fractional currency, and they handed him a draft bill. Kasson introduced the bill himself.¹

Congress remained in session through the night of March 3, 1865. The House passed the bill that evening. The Senate took it up the following morning, March 4, during the extended final session, and passed it without debate after some procedural interruptions. Lincoln signed it on the morning of March 4, 1865, six weeks before his assassination; because the extended final session still counted as March 3, the law is formally the Act of March 3, 1865.²

Longacre's Design and the Wreath He Reused

Chief Engraver James B. Longacre produced the design from his existing vocabulary. His Liberty, facing left on the obverse, wears a coronet inscribed LIBERTY with her hair neatly arranged; UNITED STATES OF AMERICA arcs around the periphery with the date below. The portrait is a close relative of the Liberty he had been producing for the gold dollar and the three-dollar gold piece for over a decade, a face that appears in recognizable form across most of his mature work. The reverse carries the Roman numeral III inside a wreath, adapted from the laurel wreath Longacre had used on the 1859 Indian Head cent. The coin measured 17.9 millimeters in diameter and weighed 1.94 grams, larger and heavier than the silver trime it was intended to supplement. The alloy of 75 percent copper and 25 percent nickel, more than double the 12 percent nickel of the copper-nickel cents of 1857 to 1864, gave it a bright, slightly silvery appearance; once silver returned to circulation, its near-dime diameter caused confusion and small frauds.³

IN GOD WE TRUST, which had just been mandated for all coins large enough to accommodate it, does not appear anywhere on the three-cent nickel. The coin was deemed too small. The design remained entirely unchanged for twenty-four years, which is unusual in an era when the Mint modified coin designs after relatively short runs.

First Year Success, Immediate Displacement

The three-cent nickel entered circulation in mid-1865 to strong initial demand. More than 11.3 million were struck in the first year, the highest annual total the denomination would ever reach. The coins did what they were designed to do: they replaced fractional three-cent notes in commerce and provided exact change for postage. The public responded far more positively to a base-metal coin than to paper of the same value.⁴

The enthusiasm was short-lived. In May 1866, Congress authorized the five-cent Shield nickel in the same copper-nickel alloy, again at Wharton's urging. Five cents fit the decimal monetary system more naturally than three, and a single five-cent coin was more versatile for transactions than the awkward arithmetic of three-cent units. The Shield nickel quickly became the preferred base-metal coin of small commerce. The three-cent nickel's annual mintage fell from over 11 million in 1865 to under 5 million in 1866 and continued declining year by year. The denomination had been outcompeted before it was a year old.

The Long Decline: 1870 to 1889

By 1871 the annual circulation mintage had fallen below one million, and it would remain there for virtually every subsequent year. The denomination persisted through the 1870s on the specific demand created by three-cent postage, the only commercial function the five-cent nickel did not render redundant. By 1877 that demand had fallen low enough that the Mint suspended business strikes entirely. The 1877 and 1878 dates are proof-only, with 2,350 Proofs struck in 1878, while the 1877 mintage was never recorded and published figures include 510 (PCGS) and 900 (the Red Book).⁵ Business strikes resumed in 1879 at very low levels. Then 1881 produced a single spike back above one million pieces. It did not recur: business strikes fell back to the thousands and low tens of thousands for the rest of the decade, and 1886 followed 1877 and 1878 into proof-only status with no business strikes produced.

The postal rate reduction of October 1, 1883, cutting first-class postage from three cents to two, removed the coin's last practical justification. A denomination engineered for stamp purchases had no special advantage once stamps no longer cost what it was worth. Production continued through 1889 at minimal levels, and the Act of September 26, 1890 formally abolished the denomination along with the gold dollar and the three-dollar gold piece. Many 1888 and 1889 pieces still held at the Treasury were melted, as were millions more returned from banks; the recovered metal went into the large Liberty Head nickel mintages of 1890 to 1893.⁶

The 1887/6 Overdate and the Proof/Business Strike Problem

The three-cent nickel's design stability across twenty-four years meant few varieties. The 1873 date comes in two forms based on the shape of the 3 in the date: Close 3 and Open 3, with the Close 3 the scarcer. The 1887/6 overdate is the series' most notable variety: a die originally prepared for 1886, which was a proof-only year, had its final digit altered from 6 to 7 rather than wasting the die. Evidence of both digits is visible under magnification. Two overdate varieties are catalogued, a strong and a weak overdate, both as Proofs.⁷

Attribution is the main problem in the later dates. From the late 1870s through the mid-1880s, the Mint did not maintain a sharp distinction between Proof and business-strike production standards. Coins from 1879 through 1885 are sometimes misattributed, a Proof with dull surfaces passing as a business strike or the reverse. For several dates in the 1880s the Proofs are more common today than the business strikes, 1882 among them.⁸ The boundary between a frosty Proof and a high-grade business strike can be genuinely ambiguous. A collector buying a high-grade business strike from the late series should ask whether the coin could be a Proof before paying for it as a business strike.

Building the Set

The three-cent nickel is collected primarily as a type coin; the 1865 first-year issue is the most frequent choice given its low cost in circulated grades and its large business-strike mintage. A date set covering every year from 1865 through 1889 is achievable, though it requires acquiring Proofs for 1877, 1878, and 1886. The 1887/6 overdate is typically included by specialists pursuing a complete variety accounting.

Early dates through 1876 are available in circulated grades at modest prices. The transition to 1877 shifts the series into Proof territory where prices are higher and populations smaller. The late business strikes from 1882 through 1885 are genuinely scarce in any grade and command premiums out of proportion to the coin's modest collector profile. Before paying a premium for a difficult date, compare its price with a coin of similar population in a better-known series, such as a Morgan dollar.⁸

Many pieces are weakly struck. The usual weakness is at the III and at Liberty's head, which sit opposite each other in the dies, so the hard alloy often failed to fill both completely. Original surfaces and absence of cleaning are the primary condition standards. The copper-nickel alloy does not tone dramatically, but harshly cleaned examples show a distinctive flat brightness clearly different from genuine mint luster.