The Coinage Act of 1792 established the United States Mint and provided for the construction of a facility in Philadelphia, the new nation’s first federal building. The same law also established a decimal-based currency system in the United States, with the dollar as its cornerstone and “money of account.” The Mint building was constructed in 1792 and began production the following year.
The Coinage Act also made specifications for the design of the coinage, and engraver Robert Scot was tasked with bringing the design to fruition. His design for the dollar was very similar to his design for the Flowing Hair cent, which was the first coin produced at the new Mint facility. The obverse features a bust of Liberty with the long, flowing hair for which the design became known. The reverse has an eagle, also required by law, surrounded by a wreath.
The technology used to produce the Flowing Hair dollar was primitive. All work on the dies was done by hand. The dies themselves were of poor quality. A screw press, powered only by a worker, was used for the striking process itself. All of these flaws are evident in the coins themselves. In addition, many of planchets (or “blanks”) used to produce Flowing Hair dollars were of varying size and fineness. Many coins were rejected, and the Mint produced just 1,758 dollars in 1794 and approximately 160,000 the following year.
The purity and dimensions of the dollar were based on the results of a study conducted by Alexander Hamilton. Prior to the establishment of the Mint, Spanish dollars (and a variety of other foreign coins) circulated throughout the United States. Hamilton, the nation’s first Secretary of the Treasury, had actual Spanish dollars weighed and used the average to calculate specifications for the new dollar. Per Hamilton’s recommendation, the new dollar was to have a purity of 89.2% silver.
However, contrary to this standard as laid out in the Coinage Act, Mint officials changed the purity to 90.0%, which would be easier to produce. The weight of the coins was not changed. As a result, it would require about 1% more silver to produce the same number of dollars versus what was specified by law. At this time, the Mint only produced gold and silver coins when deposits of those metals were brought to the Mint for the purpose of being converted into coinage. As a result, depositors lost money when they had their silver coined into Flowing Hair dollars.
The Flowing Hair design was replaced in late 1795 by the Draped Bust dollar. It is unclear what prompted the redesign, but the appointment of a new Mint Director in July 1795 was a likely impetus.
As the first dollar coin struck by the United States Mint, the Flowing Hair dollar is one of the rarest and most valuable American coins. It is known for both for its historical significance and its rarity. Only a few hundred 1794 dollars survive today. In 2013, a 1794 dollar sold at auction for over $10 million, the highest price paid for any coin at that time.