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 and Flying Eagle pieces had been swept out by speculators once their nickel content became commercially valuable. 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 had been hating them with equal consistency ever since.

The case for a copper-nickel three-cent piece was straightforward. It would have no melt value worth pursuing, making hoarding irrational. It would retire the shinplasters from commerce. The driving force behind the bill was Pennsylvania industrialist Joseph Wharton, whose operations in the Lehigh Valley controlled the principal domestic supply of nickel ore 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 spent years lobbying him, and the argument that eventually worked was not that nickel was good but that another issue of three-cent fractional currency was worse. 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 March 4, 1865, six weeks before his assassination.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 75 percent copper and 25 percent nickel composition, identical to the copper-nickel cents of 1857 onward, gave it a bright, slightly silvery appearance that could be confused with the dime in poor lighting; the complaint surfaced quickly after distribution began.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. No one found a reason to change it, and no one seems to have tried.

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 mintages of approximately 510 and 2,350 pieces respectively.⁵ Business strikes resumed in 1879 at very low levels. Then 1881 produced a single anomalous spike back above one million pieces, the reason for which is not clearly documented in surviving records; no contemporary explanation appears in Mint Director annual reports for that year, and the specialist literature treats the spike as unexplained. It did not recur: annual mintages dropped back into the low thousands through the 1880s, 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. Millions held at the Treasury were melted; the recovered metal contributed to enlarged Liberty Head nickel mintages through the early 1890s.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 Open 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 die varieties of the 1887/6 are known, one definitively a Proof and a second whose business-strike status has been debated by specialists.⁷

The authentication challenge in the later dates deserves attention before purchase. From the late 1870s through the mid-1880s, the Mint did not maintain a sharp distinction between Proof and business-strike production standards. Many coins from 1879 through 1885 that carry business-strike attributions are, on close inspection, Proofs with atypical surfaces. Several dates in the 1880s that appear in collections as business strikes are, per Bowers, simply Proofs with a degree of mint luster. The boundary between a frosty Proof and a high-grade business strike can be genuinely ambiguous. A collector pursuing high-grade business strikes in the late series should proceed accordingly.

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. Rare dates in this series have been consistently noted by specialists as underpriced relative to coins of comparable scarcity in better-known series; what a difficult three-cent nickel date should cost relative to a Morgan dollar of equivalent population is a comparison worth making before paying any premium here.⁸

Strike quality is adequate for the series overall, which puts it ahead of the silver trime. The primary weakness is the first stroke of the Roman numeral III on the reverse, which sits opposite Liberty's cheek and can come up soft when the hard alloy resists filling both dies equally. 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.