Gold, Silver, and Greenbacks

Unlike current Federal Reserve notes—the United States' legal tender—previous U.S. currencies were backed by silver, gold, or the good faith of the government. Before the Civil War, only coin was legal U.S. tender. Banknotes—paper money—were issued by individual banks and were therefore not accepted across the entire country. Throughout the nineteenth century and into the mid-twentieth, gold and silver were used as backing for U.S. paper currency, along with government obligation and debt.