Continentals refer to the currency issued by the Continental Congress during the American Revolution, also known as Continental currency. This type of money was issued between 1775 and 1779 in order to finance the war effort against the British. Continentals were printed in various denominations, ranging from one dollar up to one thousand dollars.
However, the continentals quickly faced significant problems. One major issue was their lack of backing by tangible assets, such as gold or silver. The currency relied solely on the faith and credit of the Continental Congress, which created a lack of confidence in its value. This resulted in rampant inflation, as the government printed more continentals to meet the increasing demands of war.
Furthermore, counterfeiting became rampant, further undermining the already weakened value of the currency. The British even engaged in an organized effort to counterfeit and flood the market with fake continentals, exacerbating the inflationary crisis. As a result, the continentals rapidly depreciated in value, causing prices to soar and making it difficult for individuals to conduct business transactions.
Ultimately, the continentals became virtually worthless, and their use as a medium of exchange diminished. The failure of this early attempt at paper money highlighted the importance of stability and trust in a currency’s value. After the Revolution, the United States transitioned to a new monetary system, with the passage of the Coinage Act of 1792, establishing the United States dollar as the official currency.