Coinage Act of 1965

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The Coinage Act of 1965 was a U.S. law designed to fix a growing coin shortage and to conserve the nation’s silver for other uses. In the early 1960s, demand for silver rose sharply, stockpiles fell, and many people began hoarding silver coins, especially after the Kennedy half dollar was released in 1964. President Lyndon B. Johnson urged Congress to act to prevent a silver crisis and to keep coins in circulation.

What the act did
- Dimes and quarters switched from 90% silver to copper-nickel “clad” coins (a copper core with a copper-nickel outer layer). These coins could be used in vending machines and did not rely on silver.
- The half dollar would still use silver, but at 40% for a transition period. The plan also banned minting new silver dollars for at least five years.
- The law created a Joint Commission on the Coinage to study future coin needs, silver prices, and whether silver dollars should continue.
- It allowed the government to buy silver from mining companies at a set price for up to five years if needed to smooth the transition.

How it unfolded
- The act was signed into law on July 23, 1965. The first clad dimes and quarters entered circulation in late 1965. Silver coins continued to circulate for a time, but the market and public behavior shifted as the new coins became common.
- The government ended efforts to keep silver prices low and moved away from circulating silver coins by the late 1960s. Melting and exporting silver coins were restricted, and silver certificates stopped being redeemable for silver bullion.

Longer-term effects
- By 1968–1969, silver coins largely disappeared from everyday use, and the nation moved toward base-metal coinage. The five-year rule on minting silver dollars expired around 1970.
- In 1971, the United States began circulating base-metal dollars and half dollars (including the Eisenhower dollar), with silver largely removed from circulating coins. The era of circulating silver coins ended, and the coin supply was stabilized with modern clad and base-metal designs.