Just as the California Gold Rush resulted in the San Francisco Mint’s creation, the discovery of Nevada silver precipitated the Carson City Mint. In particular, the massive Comstock Lode created immense fortunes for prospectors in Nevada. It was first identified by two veterans of the California Gold Rush in 1857, but a miner named Henry Comstock was one of the first to lay claim to the area. Word of the massive discovery spread quickly and Northern Nevada exploded in population. The town of Virginia City NV, for instance, had over 10,000 residents in 1880 but now has fewer than 1,000 today.
A problem soon arose: what should be done with the massive amount of silver extracted from the earth? Nevada was truly isolated from the rest of the nation, which made selling and refining the silver difficult. The closest major population center was San Francisco, but transporting metal to California was logistically challenging and treacherous. Railroads had not yet reached Nevada, so the only way to move metal was via horse or mule.
Eventually, in 1863, Congress approved the establishment of a branch mint in Carson City. Unlike in San Francisco, where the new branch mint opened extremely quickly, construction of the Carson City mint dragged on for years. The facility eventually opened with just one solitary coin press in 1870. Not surprisingly, the very first coin struck at Carson City was a Silver Dollar – a reflection of the tremendous quantity of silver available in the area. Indeed, for the mint’s entire history, the primary focus was on issuing silver coins instead of gold.
The earliest Carson City gold coins are wildly rare and extremely valuable. In 1870, for example, just 3,789 Double Eagles were issued at the branch mint – and just several dozens are known to collectors today. They routinely sell for hundreds of thousands each. The Carson City Mint also began producing $5 Half Eagles and $10 Eagles for circulation, but also in relatively limited quantities. The number of coins struck was purely a function of how much gold was mined in the area. With silver being the primary metal extracted in Nevada, there was only a small amount of gold ore available for coinage.
The Carson City Mint continued operations until 1893 when the mining bonanza began to end. The “low-hanging fruit” was completely spoken for by that point and remaining mineral deposits were either too difficult to access or commercially unviable. Some silver and gold were recovered from the Comstock Lode in the 20th century, but only as a result of new technologies and dramatically higher bullion prices. Whereas hundreds of mining companies existed in the mid to late 19th century, just a few were in existence by the 1920s and 1930s.