Few coins have carried the weight of a nation's money for as long as the Sovereign. It was born in the reign of Henry VII. It was reborn after Waterloo. It became the coin that much of the world trusted for a century. Today it remains UK legal tender gold, more than five hundred years after the first one was struck. Its story is the story of sound money in Britain.
A coin fit for a king
The first Sovereign was ordered by Henry VII in 1489. Valued at one pound, or twenty shillings, it was the largest coin England had yet issued. At around 42mm across and close to half an ounce of high purity gold, it announced a new dynasty. It weighed about 15.55 grams, twice the weight of the ryal, an earlier English gold coin. It was probably used as a presentation piece as much as everyday money.
The design made that plain. On the front the king sits enthroned, crowned and holding the orb and sceptre. On the back the royal arms rest on a great Tudor rose. The name said the rest. This was the coin of the Sovereign himself.
The later Tudors struck Sovereigns of their own, as did James I on taking the English throne in 1603. In 1604, soon after proclaiming himself King of Great Britain, he replaced it with a new twenty shilling piece called the Unite. For more than two centuries the name disappeared.
The Great Recoinage and a new beginning
The Napoleonic Wars left Britain's coinage worn and short. The Coinage Act of 1816 set out to restore confidence, placing Britain firmly on gold. In 1817 a new Sovereign appeared.
The details were settled with care. The Prince Regent approved the new coin on 3 August 1816. An indenture of February 1817 set the standard at 46.725 Sovereigns to every troy pound of 22 carat gold. The royal proclamation followed on 1 July 1817.
It was smaller than the Tudor coin but struck to an exact standard in durable 22 carat gold. On the reverse was Benedetto Pistrucci's St George slaying the dragon. Other designs followed for a time. St George returned in 1871 and has defined the coin ever since.
Pistrucci was an Italian sculptor who had arrived in London early in 1816. His design was so fine that the engravers of the day could not reproduce it in steel, so he engraved the dies himself. His initials, B P, still sit to the right of the date. In 2009 the reverse was re-engraved using tools from the reign of George III, to bring back the detail of his original.
The new coin did not catch on at once. More than 2.3 million Sovereigns were struck in 1818. In 1819 the figure fell to just 3,574, because the public preferred banknotes. Confidence in those notes rested on the promise that they could be swapped for gold, which is why the Sovereign mattered even to people who rarely held one.
The chief coin of the world
The new Sovereign quickly earned a reputation for accuracy. Its weight and purity could be trusted wherever it travelled. By the middle of the nineteenth century it had become known as "the chief coin of the world".
That reputation rested on discipline. Under the gold standard a pound note could be exchanged for gold. The Sovereign was that gold. No government could simply create more of it. That is the quality gold still offers against money that can be printed at will.
As the Empire grew, so did demand. Branch mints were opened to strike Sovereigns closer to the gold fields and trade routes: Sydney in 1855, Melbourne in 1872, Perth in 1899, Ottawa in 1908, Bombay in 1918 and Pretoria in 1923. The last branch mint Sovereigns were struck in 1932.
Gold in wartime
As late as March 1914 the economist John Maynard Keynes predicted that the Sovereign would become "the predominant gold coin of the world". Within months the war had changed everything.
War ended the Sovereign's life in everyday tills. On 7 August 1914, days after Britain entered the First World War, the government issued one pound and ten shilling Treasury notes designed to replace it. The new notes were made legal tender, so a creditor could no longer insist on gold. Melting coin was made an offence and sending gold abroad was restricted. By the summer of 1915 gold was no longer a regular part of the nation's coinage.
Yet the Sovereign never lost its standing as emergency money. British operatives, secret agents and members of the armed forces have been issued with gold Sovereigns to use in times of need. A Sovereign is recognised almost anywhere, even where paper currency means nothing.
The modern Sovereign
From 1957 Sovereigns were struck in large numbers again as bullion coins, made to be held rather than spent. The 22 carat standard of 1817 has never changed.
The reason for the revival is telling. After the Second World War demand for Sovereigns in the Middle East and elsewhere was so strong that counterfeiters in Europe and the Middle East began striking their own. Many of the fakes contained the full amount of gold. People wanted the Sovereign so much that forgers found it worth making them honestly. In 1957 the Treasury decided to defend the coin's status by striking new ones. By 1968 around 45 million had been made, which largely solved the problem.
Today's Sovereign weighs 7.98 grams and measures 22mm across. It is 22 carat gold, roughly 91.7 percent gold with the rest mostly copper, which makes it harder wearing than pure gold. Each coin holds 7.32 grams of fine gold. Proof Sovereigns for collectors have been struck since 1979. In 1989 a special design marked the coin's 500th anniversary, showing the monarch enthroned in a nod to Henry VII's original.
The portraits on the front tell the line of succession. George III, George IV, William IV, Victoria, Edward VII and George V all appeared on circulating Sovereigns. Elizabeth II followed across the longest reign in British history. Today the coin carries King Charles III, in a portrait by the sculptor Martin Jennings. For the story behind the coin's maker, read our history of Britain's mint.
Why the Sovereign still matters
The Sovereign remains UK legal tender. Because of that, gains on it are exempt from Capital Gains Tax for UK residents. Five centuries on, it is still one of the most widely recognised gold coins in the world.
Its size suits a steady approach. A single coin holds a little under a quarter of an ounce of fine gold, which keeps each purchase modest while every coin still carries real weight. It is also easy to recognise, because buyers around the world know exactly what a Sovereign contains.
It now sits beside a younger partner. The Britannia, first issued in 1987, is struck in 999.9 fine gold. You can read its story in The Britannia: the story of Britain's flagship gold coin. Together they form the heart of Britain's gold coinage.
Speak to a specialist
If you would like to talk it through, call a specialist on 0208 064 0076, Monday to Friday, 9am to 5pm, or book a call at a time that suits you.
Sources
- Coinage Act 1971, section 2 (legal tender), legislation.gov.uk
- HMRC Capital Gains Manual CG76881 (coins and bank notes)
- NatWest Group Remembers, gold, banknotes and money supply in the First World War
- Wikipedia, Sovereign (British coin)
This article is for information only. The value of gold can go down as well as up.