In 1862, the United States was smack dab in the middle of a coin shortage. It was bad, really bad. Everything was being horded—even the cent was being stockpiled.
An American entrepreneur and inventor by the name of John Gault created something to help with this—the encased postage stamp.
The encased postage stamp is a stamp that was inserted into a small coin-size case. This case has a transparent front or back. This type of “coin” was circulated as legal tender during periods when coins were scarce.
John Gault was pretty savvy—he saw two ways to make money off of his creation. The first way was to sell them to businesses and stores that had a high demand for coins. He sold his encased stamps at 20% of the face value of the stamp.
The second way that he made money was to sell the blank back of the case of the coin as advertising. There is a minimum of thirty different companies that took up the advertising on the coins. All of the different companies lend to find some great and different varieties on this type of coin.
Encased postage stamps circulated for about a year (until about the middle of 1863). This is when the fractional currency released by United States Government became popular enough to help ease the coin shortage.
There were also some other factors that helped bring encased postage stamps to an end. One reason was was that the postage stamps that were being used for this started to become unavailable. Not only that, it cost more to buy the encased postage than what they were actually valued at in the market.
Encased postage stamps are rare today with a small fraction of the 750,000 that were originally sold surviving.
This is just one item people came up with over the years to help with coin shortages over the years. Do you know of any other ways?