By Tom LaMarre, Coins Magazine March 16, 2010

The Shield nickel started something big. It was the first nickel five-cent piece—actually composed of an alloy of copper and nickel. The design lasted less than 20 years, but the nickel itself is still going strong after nearly 150 years.

The nickel started out as a replacement for the Postage Currency and Fractional Currency five-cent notes issued during the Civil War. Nickels were also used to redeem copper-nickel Flying Eagle and Indian Head cents after production of bronze cents began in 1864. The exchanges continued for years.

“As authorized by law,” the Mint director wrote in his report for 1870, “the redemption of the nickel-copper cents was continued during the fiscal year, by exchange for the five-cent nickel coins. The amount thus received was, in pounds, 68,237; value $60,872.25.”

The Shield nickel made its debut in 1866 with a design by engraver James Longacre.

The obverse had an American shield similar to the one on the two-cent piece. The reverse had a large “5” surrounded by stars and rays.

By August 1866, New York City had a large supply of nickels. Badly worn Postage Currency was no longer needed.

Today a Very Good-8 1866 nickel is valued at less than $40.

Because of striking problems, the rays were eliminated from the nickel’s reverse in 1867. The stars, however, remained. A VG-8 1867 nickel is valued at $21.

From the beginning, critics predicted that nickels would be widely counterfeited. They were right.

In July 1867, detectives arrested Louis BelI and Louis Bellino in Cincinnati on counterfeiting charges. The two men had sold thousands of nickels made from molds in the back room of a building on Third Street. Authorities confiscated more than 5,000 counterfeit nickels.

Kids loved nickels. The Buffalo Commercial Advertiser told of an unusual parade of two wagons accompanied by brass bands and a carriage occupied by a man tossing handfuls of nickels to a crowd of boys. He told police he was the “Savior come to redeem the world.” Investigators learned he had been released from a Toronto asylum.

In 1872, the Uxbridge (Mass.) Bank was robbed. An anonymous letter led to the recovery of a bag containing $50 in nickels.

They were hidden behind a stone wall near the South Framingham railroad depot.

Fewer than 73,000 nickels were struck in 1881. “The five-cent nickel coins of the United States having been presented for redemption at the several sub-treasury offices in such quantity as to show the amount outstanding to be redundant, the coinage hereof has been suspended.” Those were the words of the Treasury secretary in a circular dated March 26, 1881.

In December 1882, however, the secretary reported there was “large demand” for five-cent nickels. They made popular gifts, and they were also needed to make change during the Christmas rush.

More than 11 million nickels were struck in 1882. A VG-8 specimen is valued at $20.

Production of Shield nickels ended in 1883. Nearly 1.5 million were struck that year.

You should be able to buy a VG-8 1883 Shield nickel for $21, according to Coin Prices.



More Resources:

• Subscribe to our Coin Price Guide, buy Coin Books & Coin Folders and join the NumisMaster VIP Program

• 2010 U.S. Coin Digest, The Complete Guide to Current Market Values, 8th ed.

• State Quarters Deluxe Folder By Warmans

• Standard Guide to Small-Size U.S. Paper Money, 1928 to Date

• Strike It Rich with Pocket Change, 2nd Edition