World Silver Coin = Piece of Eight + Chinese Chops

Piece of eight?

Chinese chops?

No.

Well actually, yes, in a sense.

This valuable coin story (with a tip of the hat to the subject of this web site) is a mix of ingredients – history, facts, people, places, and of course, coins and coin like objects.

And it all pertains to coins such as the Mexican silver coin, truly a world silver coin, pictured above.

Not only that, it foreshadows the globalisation of our own time.

OK, just stop. That coin – the one at the top of the page – is UGLY. And damaged! That’s not even legal…

Perfectly legal in China at the time. Not only legal, but necessary. Here’s the scoop (or the chop, in this case):

China has traded with the West, originally Europe, for centuries – from the time of Marco Polo (look him up – fascinating story!) The trade routes were overland, from Europe to China, until the 17th and 18th centuries, when seaborne trade began in earnest along the Chinese coast.

Hard money -- real silver was the preferred medium of exchange.

This was fine with European traders – they had lots of silver coins. However, the Chinese were suspicious of the foreign coinage.

Suspicious? These were Spanish pieces of eight, 90% silver and known the world over. Why were the Chinese suspicious? Did they have anything better?

Oh yes -- they had something they had trusted for centuries -- a familiar form of silver -- usually finer than 90% -- with quality expressly assured by the payer.

The Chinese had the "Sycee".

The sycee was not really coinage. It was hard money. The sycee was an ingot like piece of silver in weights of 1, 5 10, or 50 “taels”. (A tael was 37 – 50 grams of pure silver, depending on the province of origin.)

Sycee were made in shoe-like shapes, hollow with open tops and steep sides. Sometimes they were simply round, but each was unique as no dies were involved. Sycee were cast from molten metal, poured over a mounded form, then tapped from side to side to produce a striated (grooved) surface as the metal cooled. The purest metal resulted in the finest striations.

This seems rather... imprecise.

Sycee circulated locally. These pieces were produced by local merchants, not the government. Sycee were made in such a way that their purity could be discerned by the knowledgeable recipient. In local trade, sycee of specific craftsmen were known on site, and trusted accordingly.

This was the currency model encountered by European sea captains upon arrival in Chinese ports. A western trade coin, a so-called world silver coin, appeared exotic to Chinese eyes – a little disc of peculiar design – not to be trusted -- and not to be compared with the time honored sycee.

Chinese merchants were concerned about the authenticity of foreign coinage. What if the strange looking world silver coin was a fake? Soon counterfeit coins did appear, justifying the skepticism of each and every oriental trade company.

But trade between East and West was too good to pass up. Coins were what the foreign traders had -- not sycee. What to do?

Chinese Chop Marks

Look at the coin at the top of the page. The Chinese characters randomly punched across the not-so-pretty face of Carlos IV were, in fact, marks of approval.

Upon receipt of a trade coin, the Chinese merchant would judge the weight and purity of the coin. If the coin was deemed acceptable, the merchant would add his chop – his unique mark of satisfaction – to the piece. An iron punch bearing the chop was used to mark each approved coin.

In this way, a merchant invested not only his funds, but his reputation.

The result?

Coins like the world silver coin shown above became acceptable in the China trade.

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