Gold-backed currency is money tied to physical gold. For more than a century in the United States, that meant paper money the government promised to exchange for a fixed weight of gold. The United States cut the last of those ties in 1971. Goldbacks take a different route: the gold sits inside the note itself, so there is nothing to redeem.
This guide explains what gold-backed currency means, how the U.S. moved away from it, and how Goldbacks work as a gold-based local currency today.
What Is Gold-Backed Currency?
A gold-backed currency is money whose value connects directly to gold. That connection takes one of two forms:
- Money you can redeem for gold. A government issues paper notes and promises to swap them for a set amount of gold on demand. This is the classic gold standard.
- Money that contains gold. The currency carries the metal itself. Gold coins worked this way for centuries. Goldbacks work this way today.
Fiat money works differently. Its value rests on the authority of the government that issues it, not on a reserve of metal. The U.S. dollar is a fiat currency.
A Short History of the Gold Standard in the U.S.
The dollar stayed linked to gold for well over a century. Federal Reserve History, the Federal Reserve System's own history site, documents the main steps:
- 1830s to 1900. The United States ran on a de facto gold standard from the 1830s and wrote it into law in 1900. The official rate was $20.67 per ounce of gold.
- 1913. Congress built the gold standard into the new Federal Reserve. The Fed had to hold gold equal to 40 percent of the currency it issued and convert dollars into gold at $20.67 per ounce.
- 1933. During the banking crisis, gold drained out of the Federal Reserve. On April 20, 1933, President Franklin Roosevelt formally suspended the gold standard and barred banks from converting currency into gold.
- 1934. The Gold Reserve Act moved ownership of all monetary gold in the country to the U.S. Treasury. It ended the redemption of dollars for gold at home and reset the rate to $35 per ounce.
- 1944 to 1971. Under the Bretton Woods system, 44 countries fixed their currencies to the dollar, and the dollar stayed convertible into gold at $35 an ounce for international settlements.
- August 15, 1971. President Richard Nixon closed the "gold window." Foreign governments could no longer exchange dollars for gold, and the international monetary system became a fiat one.
- 1974. President Gerald Ford signed an act of Congress that let U.S. citizens own and deal in gold again.
Gold never left the economy. Since 1974, Americans have been free to buy, hold, and trade it. What changed is the dollar in your wallet: it no longer represents a claim on any gold.
How Goldbacks Differ From the Old Gold Standard
Under the gold standard, a dollar was a promise. You held paper and relied on the issuer to hand over gold when you asked. Goldbacks remove the promise. Each note contains a precise amount of 24-karat gold, atomized and layered between two polymer sheets with patented vacuum deposition technology. When you hold a Goldback, you hold the gold.
Three other differences matter.
Goldbacks are private and voluntary. Goldback Inc., a private company, issues them. Goldback describes its notes as a voluntary, local-currency model that runs alongside the existing system and isn't government-backed. People accept Goldbacks because they choose to, not because a law requires it.
Goldbacks are not U.S. dollar legal tender. Goldback states that its notes carry language affirming they are not U.S. dollar legal tender, and it prints "privately issued" on them. Goldbacks complement the dollar rather than imitate it. Goldback says they are recognized as an exchangeable currency only where local or state law authorizes them. Elsewhere, people use them in barter or hold them as a gold product. For the legal background, read Are Goldbacks Constitutional Currency?
State series, one system. Goldbacks come in regional series, including Utah, Nevada, Wyoming, New Hampshire, South Dakota, Florida, Oklahoma, Arizona, Idaho, and California. Each series has its own artwork. Merchants in the Goldback network accept any Goldback, whatever the series, and any note works anywhere both parties agree to use it.
How the Goldback Exchange Rate Works
The number on a Goldback is its denomination, not a dollar amount. A 1 Goldback contains 1/1,000 of a troy ounce of gold. Any combination of 1,000 Goldbacks adds up to one full ounce, and a 50 Goldback equals exactly fifty 1 Goldbacks.
To convert Goldbacks to dollars, Goldback Inc. publishes a daily exchange rate. It updates the rate every day at 10 AM Mountain Standard Time. The rate follows the current market value of gold. It also reflects the labor, technology, and anti-counterfeiting security that go into each note, which is why a Goldback costs more than the raw value of its gold. Because the gold price moves every day, the dollar value of a Goldback moves with it, in either direction.
Merchants use the rate to price a sale. The buyer converts the total with the Goldback calculator, hands over the right mix of denominations, and gets change in smaller Goldbacks or in cash. Merchants often accept part of a payment in Goldbacks and the rest in cash, debit, or credit.
You can track today's Goldback rate by denomination, next to the live gold price, on our Gold Price Today and Goldback Rate page.
Goldback Denominations
Each denomination holds a fixed fraction of a troy ounce of 24-karat gold:
| Denomination | Gold content | Note |
|---|---|---|
| ¼ Goldback | 1/4,000 troy oz | Smallest denomination |
| ½ Goldback | 1/2,000 troy oz | |
| 1 Goldback | 1/1,000 troy oz | 1,000 = one ounce |
| 2 Goldback | 1/500 troy oz | |
| 5 Goldback | 1/200 troy oz | |
| 10 Goldback | 1/100 troy oz | |
| 25 Goldback | 1/40 troy oz | |
| 50 Goldback | 1/20 troy oz | |
| 100 Goldback | 1/10 troy oz | Discontinued by Goldback; existing notes stay valid |
Not every state series includes every denomination. Each state collection in our shop lists the notes available for that series.
Where to Spend and Buy Goldbacks
Spend them. Thousands of independent businesses across the U.S. accept Goldbacks at the register. The Goldback app and merchant map list participating businesses by location. See Where Are Goldbacks Accepted? for how to find them.
Buy them online. GoldATM carries Goldbacks by state series and denomination, with pricing updated daily and no order minimums. Browse every state series collection.
Buy them in person. GoldATM kiosks sell Goldbacks for cash at retail locations. Find the nearest machine at goldatm.com/locations.
New to Goldbacks? Start with What Is a Goldback? It covers how the notes are made, their security features, and every state series.
Frequently Asked Questions
Is the U.S. dollar backed by gold? No. The United States stopped redeeming dollars for gold at home in 1933 and 1934. On August 15, 1971, it also stopped converting dollars held by foreign governments. The dollar has been a fiat currency since then.
What is the gold standard? The gold standard is a monetary system in which a government fixes its currency to a set weight of gold and redeems notes for gold on request. U.S. law set the rate at $20.67 per ounce from 1900 until the gold standard was suspended in 1933.
Are Goldbacks a gold-backed currency? Yes, in the most direct sense. Each Goldback contains a fixed amount of 24-karat gold inside the note, so the gold travels with the currency. A private company issues them, and people use them by voluntary agreement.
Are Goldbacks legal tender? Goldbacks are not U.S. dollar legal tender, and Goldback says the notes carry language stating that. They are legal to own and to use in voluntary exchange. Goldback says they are recognized as an exchangeable currency only where local or state law authorizes them.
How much gold is in a Goldback? A 1 Goldback contains 1/1,000 of a troy ounce of 24-karat gold. The ¼ Goldback holds 1/4,000 of an ounce, and the 50 holds 1/20. Any combination of 1,000 Goldbacks equals one troy ounce.
Start here: What Is a Goldback?
Today's rate: Gold Price Today and Goldback Rate
Where to spend them: Where Are Goldbacks Accepted?