DEFINITION of 'Gold Certificate'

A physical document resembling a paper bank note that entitles the holder to a specified value of gold. Because gold bullion is difficult to transfer and store, gold certificates facilitated the ownership and use of gold when it was legal currency. Gold certificates were in general circulation in the United States and used as money from 1882 to 1933.

BREAKING DOWN 'Gold Certificate'

The United States government under President Franklin D. Roosevelt made gold certificates, as well as the possession of gold in any other form except jewelry, illegal in 1933 when the U.S. went off the gold standard. About 30 years later, gold certificates became legal again, and they have been prized by collectors ever since, but they are not legal tender. The highest denomination of gold certificate ever issued was for $100,000, but it was only used as an accounting tool within the Federal Reserve. One such note belongs to the Smithsonian collection at the National Museum of American History.

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