Formidable MS68 1854 Type Two Gold Dollar

1854 G$1 Type Two MS68 NGC. The Small Head Type Two gold dollar is a notoriously scarce type. It was struck for only three years, with the final year of production limited to a tiny San Francisco emission. San Francisco was late in the game due to the geographic distance between the two coasts. Each of the other three branch mints then in operation, Charlotte, Dahlonega, and New Orleans, struck a small number of Type Two pieces in 1855.
Due to the cost and scarcity of the branch mint issues, most type collectors choose either the 1854 or 1855 Philadelphia dates. Their mintages are similar, separated by only 25,674 pieces, and they trade at equivalent levels. The 1854 mintage of 783,943 pieces compares favorably with the more than 4 million pieces struck in 1853. Undoubtedly, the reason for the much smaller production is related to the heavy mintage of silver half dimes through half dollars in 1853.
Silver coins had nearly vanished from circulation by 1853, since their bullion value exceeded face. The traditional silver to gold ratio was affected by the large quantities of gold recovered from California mining camps. Gold coins continued to circulate, while silver coins were hoarded by speculators. As the lowest denomination gold coin, the gold dollar was needed in commerce to fill the gap caused by silver's absence.
Like the silver three cent piece, the gold dollar was essential to commerce when there was little alternative. But in 1853, the weight of the Seated Liberty denominations was reduced, with the exception of the silver dollar. Once again their face value exceeded their value as bullion, and the half dime, dime, quarter, and half dollar returned to circulation. Mintages of the half dime, dime, and quarter broke records in 1853. Production of the half dollar was at a ten-year high.
The flood of silver coinage reduced the need for the gold dollar, which was unpopular in any event because its small diameter made it easy to lose. To combat this problem, the Type Two's diameter is 15 mm, slightly greater than the 13 mm Type One.
In the 19th century, it was Mint policy to limit designs, preferably one per alloy. The half cent and cent, the half dime and dime, the quarter and half dollar, and the quarter eagle through eagle had similar designs. But the three dollar gold piece, introduced in 1854, was similar in value to the quarter eagle, and needed distinctive motifs. The increased diameter Type Two gold dollar needed new designs, and it was natural to re-use the wreath and layout of the approved three dollar.
Mint officials likely regretted their decision to create a new bust of Liberty for the Type Two obverse. Longacre's Small Head was in high relief, causing metal to flow into the portrait and away from the corresponding area of the reverse. Thus, DOLLAR and the date are nearly always weak on Type Two gold dollars. This problem was alleviated in 1856, when the Small Head was scrapped in favor of the Large Head conveniently taken from the three dollar design.
The two-year, relatively small Type Two mintage at Philadelphia led to the rarity of this gold type. In 1854 and 1855, there were few collectors, even on the East coast. As a store of value, gold dollars were set aside, but rarely was its condition of any concern. It is remarkable, then, that a few high grade Mint State examples have survived. PCGS has yet to grade any Type Two dollars above the MS67 level, and NGC has certified just two pieces as MS68 with none finer. Both coins are 1854 Philadelphia examples. One of them is the Eliasberg piece, auctioned in October 1982 and again in July 2002.
The other MS68 example is the present lot. As one would expect from its remarkable grade, it is completely unabraded. A small smudge on the holder at 12 o'clock on the obverse has no impact on the coin itself. The coin is currently being reholdered to remove the smudge. Minor planchet granularity near the UNI in UNITED is as made. The strike is crisp, particularly for the type, with minor incompleteness on the left-side denticles and a whisper of softness on the LL in DOLLAR and the 8 in the date. Here is a miracle, a coin that appears just as it did when it left the dies more than a century and a half ago, despite the fact that it was struck for circulation instead of a collector's cabinet. We can only thank the alert antebellum individual that recognized its importance and immediately set it aside for posterity. Norman Stack described the present piece in 1986 as "a pristine specimen, probably without its equal. ... We will grade this incredible coin Mint State-70. The coin is exactly as it left the dies 130 years ago." Census: 2 in 68, 0 finer (1/08).
Ex: James Walter Carter & Margaret Woolfolk Carter Collections (Stack's, 1/86), lot 29; Auction '89 (David W. Akers, 7/89), lot 1341; American Numismatic Rarities, 7/03, lot 624.
From The Southwest Collection.(Registry values: N1) (#7531)

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