11 US States Recognize Gold and Silver as Currency
A growing number of states across the United States are passing legislation to recognize gold and silver as legal tender or to facilitate their use as currency. This movement, often driven by proponents of “sound money” and concerns about inflation and the stability of the U.S. dollar, is gaining traction in state legislatures, reaffirming the constitutional role of precious metals in the nation’s monetary system.
Growing Movement for Sound Money
The push to recognize gold and silver is part of a broader trend among states seeking to diversify their economic base and provide residents with alternatives to traditional fiat currency. Advocates argue that restoring gold and silver to their historical status as money can offer a hedge against currency devaluation and economic uncertainty.
Constitutional Basis Gold and Silver as Tender
Proponents of state-level action often point to Article I, Section 10 of the U.S. Constitution, which states that “No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts.” This clause is interpreted by some as not only prohibiting states from using other forms of payment for debts but also affirming the status of gold and silver coin as legal tender that states can recognize. State laws in this movement often align with or reaffirm this constitutional principle.
States Taking Action Listing the Leaders
While the specifics of legislation vary from state to state, several have been at the forefront of this movement, passing laws to recognize gold and silver as legal tender, eliminate related taxes, or establish state bullion depositories. States frequently mentioned as having taken significant steps include:
- Utah: Often cited as the first in recent history to pass legislation recognizing U.S.-minted gold and silver coins as legal tender (2011).
- Oklahoma: Recognizes gold and silver U.S.-minted coins as legal tender and exempts them from state taxation.
- Wyoming: Has enacted legislation making gold and silver coins legal tender within the state.
- Arkansas: Passed a law to make gold and silver function as legal tender.
- Florida: Recently passed legislation officially recognizing gold and silver coins as legal tender and exempting them from sales tax when used in transactions.
- Alabama: Reaffirmed gold and silver as legal tender, aligning with the U.S. Constitution, though the law may not mandate their acceptance for debts unless by contract.
- Idaho: Eliminated capital gains taxes on gold and silver and reaffirmed them as legal tender.
- Louisiana: Has passed legislation recognizing gold and silver as legal tender.
- Texas: Has seen legislation introduced aimed at establishing legal tender status for gold and silver and has established a state bullion depository.
- Arizona: Has passed laws allowing the use of precious metals as currency, though earlier attempts at explicit legal tender status were vetoed.
- West Virginia: Eliminated sales tax on investment metal bullion and coins, contributing to treating precious metals more like currency.
The specific legal implications vary; for instance, some laws clarify that while gold and silver are recognized as legal tender, private parties cannot be compelled to accept them in transactions unless agreed upon by contract. A common element across many of these states is the removal of sales or capital gains taxes on precious metals, which proponents argue is essential for them to function as a medium of exchange rather than a taxable commodity.
Implications What This Means
The recognition of gold and silver as legal tender at the state level does not replace the U.S. dollar, which remains the primary medium of exchange. However, it provides a legal framework that could facilitate the use of precious metals in transactions if parties agree. It also sends a symbolic message about the state’s stance on monetary policy and can encourage investment in precious metals as a store of value. The long-term impact of this state-level movement on the broader U.S. financial system remains a subject of ongoing debate and observation.
