I came across the sentence on the PCGS coinfacts writeup for the Flying Cent: "Like the Large Cent, the Small Cent was not legal tender, so it should have come as no surprise that it, too, would be rejected by bankers and merchants." https://www.pcgs.com/coinfacts/category/flying-eagle-cent-1856-1858/664 On the wiki page, it says something similar: "The new cent was issued in exchange for the worn Spanish colonial silver coin that had circulated in the U.S. until then, as well as for its larger predecessor. So many cents were issued that they choked commercial channels, especially as they were not legal tender and no one had to take them." What's the story? I think this is first time I have heard it. Or at least the first time it has made me stop to think about it.
Lots of confusing info out there. Apmex's write up on the flying cent has this: An interesting note: at that time, Gold and Silver were the only metals accepted as official legal tender, so there was a great deal of opposition to the establishment of a penny coin. Then I read: In addition to demonetizing foreign coins, the Coinage Act of 1857 also discontinued the half cent. Furthermore, the penny was reduced in size. The large cent was discontinued and regular coinage of the Flying Eagle cent began. The Act fixed the weight and measure of US one-cent pieces at 4.655 grams, which was composed of 88% copper and 12% nickel. It also mandated that this new copper/nickel alloy be received as payment for the worn gold and silver coins turned in at the mint. The effective aim was to limit the domestic money supply by crushing European competition. This was the first major step towards the government essentially having a monopoly over the money supply. The Coinage Act of 1857 significantly altered the way American business was conducted. Since the beginning of the Colonies, businesses accepted any form of payment as long as it was made of specie. Following this Act of 1857, American business no longer accepted foreign coins and only US coins were accepted. Throughout this period, there was fierce competition among foreign exchange dealers in the United States. The ability of the US Mint to finally produce enough coinage made much of the foreign silver coinage obsolete. https://www.armstrongeconomics.com/...form-of-1857-ends-legal-tender-foreign-coins/ The article mainly talks about the legal status of foreign coins... not our coins that we made like the Flying Cent.
I believe there was also a shortage of copper at the same time and prices surged, therefore the down sizing of the cent and elimination of the half cent so the Mint could secure enough materials to continue coining.
Copper and copper-nickel coins were not made legal tender until the "Coinage Act of 1873," and then only up to $0.25. In 1856, silver was a legal tender only up to $5.
Cents and half cents were not legal tender. The cent did not get legal tender status until the authorization of the bronze (95% copper 5% tin and zinc) cents in 1864, and even then they only had limited legal tender status. Whether that limited legal tender status was applied retroactively to the large cents and coppernickel cents is debatable. It would seem odd to have at least four different types of cent in circulation, all issued by the same authority, and only have one of them legal tender. Likewise when the legal tender status of the subsidiary coins was limited in 1853 I do believe it was applied to the older heavier weight coins as well. The half cent was never legal tender until the coinage act of 1965 (although there was a resolution of Congress in 1933 that declared all US coins, whenever they were made, to be legal tender. Whether that resolution had the force of law I do not know.)
