Proof coins have been issued by the United States Mint since the early 1800s, but the concept of the “Proof Set” did not emerge until the mid-19th century. From 1800 through 1850, proof coins were usually struck individually as official/diplomatic gifts or to commemorate special occasions. During this era, American coins had not yet become popular as collectibles, so proof coins were more likely to end up with dignitaries or politicians than with numismatists. This largely changed in the late 1850s as coin collecting took off in America.
A very small group of collectors (literally just a couple dozen people) began to petition the Philadelphia Mint for proof coins each year. They usually wanted one of every circulating issue in proof format. Some had a limited budget and only wanted the copper and silver designs, but some could afford the gold too. By the late 1850s, every circulating denomination was being struck in proof format—albeit in tiny quantities of just 10-30 per year.
Generally speaking, these proof coins were delivered to collectors in set form. While there are relatively few official records on this subject, at some point the U.S. Mint began issuing sets of proof coins in collectors in velvet display boxes. Collectors would essentially sign up for a subscription and receive one of these presentation sets every year. This tradition became more and more popular as the decades passed; proof mintages climbed from the dozens to hundreds to thousands.
The proof set program continued until 1916 but was put on hiatus until 1935. In 1936 the U.S. Mint resumed production of proof coins, albeit this time the coins were issued in cellophane packaging. The plastic often reacted with the silver, imparting a kaleidoscope of blues, oranges, greens and browns onto the coins. Eventually the composition of the plastic was changed so that the coins would not tone as easily in their original packaging.
Today, proof sets continue to be sold to collectors in large quantities. Modern sets are extremely affordable (most sell for under $50) and make great mementos for birth years, graduations and anniversaries. Many collectors were introduced to coin collecting by receiving a proof set as a gift. As affordable as the modern versions are, vintage proof sets can be very pricey. “Virgin” 1936-1942 sets in the original packaging are likely to run $1250-$7500, while 19th century sets are almost always $10,000 or more. If the 19th century sets contain the gold denominations, expect to pay a six-figure price tag. Proof gold coins are prohibitively scarce and routinely sell for tens of thousands of dollars each.