history of the modern American Buffalo gold coin
The U.S. Mint’s 2018 American Buffalo One-Ounce Gold Proof Coin (product code 18EL) is set to be released on May 10 at noon.
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The popular gold bullion coin features the modified version of James Earle Fraser’s design of a buffalo for the Indian Head nickel on the reverse. Inscriptions IN GOD WE TRUST, UNITED STATES OF AMERICA, and E PLURIBUS UNUM can be seen on the coin as well. Toward the bottom is the denomination of $50 and composition, 1 OZ. .9999 FINE GOLD.
On the obverse is the modified version of James Earle Fraser’s design of a Native American for the Indian Head nickel. The letter “F,” seen below the year of mintage, stands for “Fraser.” The “W” mintmark of the West Point Mint can also be seen above the year of mintage while the inscription LIBERTY is located in the upper-right quadrant of the coin.
Each American Buffalo coin is placed inside of a hardwood box with a leather-like inset and is accompanied by a certificate of authenticity. For further information about the 2018 American Buffalo One-Ounce Gold Proof Coin, please visit the Mint’s website.
For those interested to learn more about the history of the modern American Buffalo gold coin, the following is an excerpt from chapter five of American Gold and Silver: U.S. Mint Collector and Investor Coins and Medals, Bicentennial to Date:
Starting in 2006, the U.S. Mint would recreate one of America’s most famous coinage designs on its first-ever series of 24K gold pieces.
The obverse of the Presidential $1 Coin Program coin for George Washington.
In addition to the American Buffalos, the Presidential $1 Coin Act of 2005 gave birth to several other new series of U.S. coins including Presidential dollars, circulating commemorative cents for the bicentennial of Abraham Lincoln’s birth, and a new cent honoring Lincoln’s preservation of the Union.
A 1913 Buffalo nickel.
The American Buffalo gold bullion designs are familiar to every U.S. coin collector. They celebrate the Buffalo (or “Indian Head”) nickel that was minted from 1913 to 1938.
The bison, “King of the Plains,” has fascinated Americans for generations. When Q. David Bowers wrote his book Buffalo Coins: America’s Favorite—The American Bison on Coins, Tokens, Medals, and Paper Money, he chose an American Buffalo gold coin to grace the cover.
As the popular and best-selling American Eagle bullion program neared its 20th year, the Presidential $1 Coin Act of 2005 (Public Law 109-145) authorized a new suite of gold bullion coins. These would be struck in 24-karat (.9999 fine) gold, a first for the U.S. Mint, and they would feature two of America’s most beloved and instantly recognizable coinage designs—the obverse and reverse of the Buffalo nickel made from 1913 to 1938.
2006 American Buffalo gold coin. Image courtesy of APMEX.
The new act, signed into law on December 22, 2005, was intended “to require the Secretary of the Treasury to mint coins in commemoration of each of the Nation’s past Presidents and their spouses, respectively, to improve circulation of the $1 coin, to create a new bullion coin, and for other purposes.” The “new bullion coin” was the .9999 fine gold American Buffalo. Title II of the act described the coins:
The initial designs of the obverse and reverse of the gold bullion coins struck under this subsection during the first year of issuance shall bear the original designs by James Earle Fraser, which appear on the five-cent coin commonly referred to as the ‘Buffalo nickel’ or the ‘1913 Type 1.’
The coins . . . shall have inscriptions of the weight of the coin and the nominal denomination of the coin incused in that portion of the design on the reverse of the coin commonly known as the ‘grassy mound.’
The Secretary shall acquire gold for the coins issued under this subsection by purchase of gold mined from natural deposits in the United States, or in a territory or possession of the United States, within one year after the month in which the ore from which it is derived was mined.
To avoid the act being used as a boondoggle for private gold-mining interests, it required that “The secretary shall not pay more than the average world price for the gold mined.” The sale price of each coin would be at least the market value of the bullion at the time of its sale, plus the cost of designing and issuing the coin (“including labor, materials, dies, use of machinery, overhead expenses, marketing, and shipping”).
The American Buffalos were intended to compete nationally and internationally with other mints’ 24-karat gold coins, which U.S. Mint Deputy Director David A. Lebryk estimated to account for 60 percent of gold bullion-coin sales worldwide (the other 40 percent being less fine but more durable 22-karat coins). The 22-karat market was already dominated by the American Gold Eagle, and with the American Buffalo, the U.S. Mint sought a share of the 24-karat market, then led by the Canadian Maple Leaf.
The authorizing legislation required that the secretary of the Treasury mint “such number of $50 gold bullion and Proof coins as the secretary may determine to be appropriate.” Interestingly, in addition to allowing the Treasury secretary to change the maximum mintage quantities after one year, it also gave him authority to alter the coins’ designs. “The secretary may, after consulting with the Commission of Fine Arts, and subject to review of the Citizens Coinage Advisory Committee, change the design on the obverse or reverse. . .” So far, this authority has not been invoked.
The First Buffalos
The West Point Mint. Photo by Daniel Case.
The first American Buffalo gold coins were struck on June 20, 2006. Their launch ceremony was held at the West Point Mint in New York’s beautiful Hudson River Valley, near the northern facilities of the United States Military Academy. U.S. Mint officials pressed two large buttons to set the presses to work, officially launching the new bullion series. “This American Buffalo gold coin will appeal to both investors who choose to hold gold and to others who simply love gold,” said Deputy Director Lebryk. “These classic and beautiful American Indian and buffalo designs by James Earle Fraser, which have been American favorites since they were first used in 1913, recall a golden age of coin artistry.” Two days after the ceremony the Mint transferred two of the historic gold coins to the Smithsonian Institution’s National Numismatic Collection.
In previous Coin History articles, the focus has predominantly been on circulating coins of the past or today. For this article, I will focus on another modern coin, but on one of the bullion coins that is offered by the United States Mint: The American Buffalo.
The American Buffalo, also sometimes referred to as a Gold Buffalo, was the first pure, 24-karat gold coin ever produced by the Mint for offer to the public. It bares a legal tender face value of $50 and was first made available starting in 2006. But how this coin came to being might surprise some readers.
The birth of the buffalo gold coin starts in 2005 with the Presidential $1 Coin Act of 2005. That act, as the name suggests, authorized the United States Mint to produce the Presidential Dollar series of coins which began in 2007. Additionally, it had two other mandates on the Mint. First, it called for the redesigning of the Lincoln Cent in 2009 in honor of the 16th President of the United States’ 200th birthday. You can read about that one-off series in this Coin History article. Secondly, and lesser known, is that it authorized the mint to produce a one-ounce 24-karat gold bullion coin. That coin was to have a $50 face value and a mintage up to 300,000 coins per annum.
Interestingly, the United States was already producing a gold coin for collectors and investors, the American Gold Eagle. That coins had been in production since 2002 and remains so today. However the government was feeling the pressure to compete with foreign gold bullion coins. The American Gold Eagle has a gold content of 91.67%. For many investors, that wasn’t enough gold so they were turning to other coins, most commonly the Canadian Gold Maple Leaf which contained 99.99% pure gold. Simply put, the U.S. wanted a piece of the investor action which is why the desire to have a .9999 gold coin found its way into this piece of legislation.
The bill itself called for this new bullion coin to be referred to as the American Buffalo and specifically called out that the design should be based on a modified version of James Earle Fraser’s design of the Indian Head Nickel (commonly referred to as the Buffalo Nickel). Few Numismatist complained about this decision as the Indian Head Nickel’s design is considered by many to be one of the best in United States coinage history. The bill was presented to President George W. Bush on December 15, 2005 and signed into law on December 22, 2005.
The Obverse depicts a Native American similar in look to that of the Indian Head Nickel. Fraser maintained that he created the iconic portrait through the mixing of facial features of three American Indian tribe chiefs: Big Tree, Iron Tail, and Two Moons. Fraser indicated that all three of these chieftains had posed for him in the making of the Nickel.
2020 American Buffalo Gold Bullion Coin
2020 American Buffalo Gold Bullion Coin (Image Courtesy of The United States Mint)
The Reverse of the coin uses Fraser’s Nickel. Specifically, it uses the Type 1 design which was introduced on the Nickel in early 1913. From mid-1913 through to 1938, a Type 2 design was used on the Nickel which had a reduced mound on which the Buffalo stood.
American Buffalo Gold Coin Reverse (Image Courtesy of The United States Mint)
American Buffalo Gold Coin Reverse (Image Courtesy of The United States Mint)
The American Buffalo gold coin made its debut in 2006. The uncirculated version of the coin was made available to dealers on June 20, 2006 while the proof version was made available to the public directly from the United States Mint on July 22, 2006. The 2006 Proof had a strict strike mintage limit of 300,000 coins and a limit of 10 coins per household was put into place on the coin. The coin was priced at $800. The 2006 American Buffalo today in MS-70 sells on average for $1700.
Sales in 2006 and 2007 were strong, prompting the Mint in 2008 to introduction fractional buffalo gold coins. In the first two years of the coin’s minting, only a one-ounce coin had been produced. In 2008 however, a 1/10 ounce ($5 face value), 1/4 ounce ($10), and 1/2 ounce ($25) coin was introduced. This was similar to the program that had been running for the American Eagle gold coin, with the expectation being that collectors and investors who could not necessarily afford the one-ounce coin would be able to afford the fractional coins. The Mint went on to produce a 8-8-08 Double Prosperity set that contained the 1/2 ounce American Buffalo and a 1/2 ounce American Eagle. The Mint’s theory on fractional sales proved to be true. All of the coins sold exceptionally well but there was an underlying problem that at least potentially inflated sales figures. That issue was the subprime mortgage crisis.
Starting in 2007, the crisis saw foreclosures and defaults on mortgages skyrocket as home values plummeted. This, in turn, drove the United States economy into recession. Investors, seeking security from the crisis and recession, began buying gold and a lot of it. Demand was so high on the Mint that on September 26, 2008, it was announced that sales of the American Buffalo coins would be halted as it could not keep up with demand. When production resumed, only the one-ounce Buffalo was produced. Today, the Mint only produces the one-ounce coin, making 2008 fractional American Buffalo’s slightly more rare.
All of the coins, uncirculated or proof, are struck at the Mint’s West Point facility in New York but only the proof version of the coin bares the “W” mint mark for West Point. The mint mark is found behind the Indian’s neck on the Obverse.
Below you will find a table of the mintage figures for the American Buffalo one-ounce coin in uncirculated condition.
American Buffalo Bullion Mintage Figures
Like other bullion coins that are offered by the United States Mint, the price of the American Buffalo has continued to rise as the price of gold has escalated over the past 14 years. Today, the 2020-W proof sells for $2415. That assumes the price of gold being at least $1700 per ounce. The price can go up or down weekly depending on the spot price of gold. If you are considering purchasing an American Buffalo for your collection or for investment, it will pay to watch gold prices to try to buy when prices per ounce are lower. In 2020, the price of gold has stayed almost unchanged due to the ongoing COVID-19 pandemic which, like the subprime mortgage crisis, is driving investors to buy more gold for protection. That, in turn, keeps prices stable and high.