Today, the dollar sign is synonymous with wealth. It’s used as a symbol for multiple currencies, rappers wear it on gold chains around their necks, and Ted Dibiase used it as the centerpiece on his championship belt.
It’s so ubiquitous that all cartoons have to do is put a dollar sign on a sack and everyone immediately knows what has been stolen.
Have you ever wondered where the dollar sign came from? It’s so commonplace today that we take it for granted, but who was the first person to put a line through an S and use it as a symbol for money? Furthermore, how did they come up with this?
If you don’t know, you’re not alone. The origins of the dollar sign are murky, and these murky origins led to multiple theories of varying credibility. In this video, we’ll take a look at the most likely origins and explore some of the less likely ones.
The Spanish Milled Dollar, or Peso
Considering that the United States was originally a British colony, it is interesting to note that the most widely circulated and credible theory is that the dollar sign comes from Spain.
This theory states that it was originally used as a symbol for the Spanish milled dollar, or peso.
The symbol first appeared in business correspondences from Spanish America, British America, the early independent U.S., and Britain as far back as the 1770s.
The first instance of it appearing in print comes from the 1790s by Archibald Binny, a Philadelphia printer credited with inventing the Monticello typeface. It was then adopted to represent the US dollar after the United States gained its independence following the American Revolution.
Transference to the U.S. dollar
If it originated with Spanish money, how did this symbol become used for American money? This is probably the easiest question to answer when exploring the dollar sign’s origins.
It starts with the United States’ Coinage Act of 1792 when the newly independent nation set out to create its own currency.
The Act created the U.S. dollar, taking its name from the Spanish milled dollar. That’s not all – it also explicitly borrowed the size and value of the Spanish coins, defining the U.S. dollar as having “the value of a Spanish milled dollar.”
In fact, up until the Coinage Act of 1857, the Spanish milled dollar was accepted as legal tender in the United States, along with a number of other foreign currencies.
Given the degree to which the U.S. dollar was modeled off its Spanish brethren, it seems likely that, if a symbol was used for the Spanish dollar, the U.S. would have adopted this as well.
As an interesting piece of trivia, the U.S. dollar is not alone in being modeled off the Spanish milled dollar – other currencies deriving from it include the Mexican peso, Argentine peso, Peruvian real, and Bolivian sol coins.
Origin of the Symbol for the Peso
Of course, if the U.S. simply borrowed the dollar symbol from the symbol for the Spanish peso, how did it come to represent the peso in the first place?
Here, there are multiple theories, but the most common comes from a case of bad handwriting.
1) Oliver Pollock’s Bad Penmanship
If you ever had points deducted for poor penmanship in school, you might find this next story entertaining.
The theory goes that the original symbol for pesos was “Ps” or “ps“. This seems like a perfectly logical, reasonable shorthand for pesos, but how did we get from here to the symbol we know today with an S and one or two bars through it?
Enter Oliver Pollock. Pollock was an Irishman who had moved to the United States prior to the Revolution. He amassed a fortune and was a major financier of the Revolution. He was also known for his poor penmanship.
The story goes that when attempting to use the ‘Ps’ symbol for pesos, the sloppy merchant would run the two letters together, superimposing them in a symbol basically akin to the modern dollar sign. The strongest evidence comes from a 1778 invoice handwritten by Pollock.
Whether the Pollock story is true or not, it appears likely that the symbol grew from the original ‘Ps’ abbreviation. A study of 18th- and early 19th-century manuscripts shows the P and the s gradually merging to become a single symbol.
Though the evolution from Ps seems most likely, other theories go back to the origin of the peso itself.
2) Introduction of the Peso
In 1497, Spain underwent a coinage reform. It was in this reform that the dollar was first introduced as Spain’s base unit of currency. Since it was replacing the old currency, the real, it was known as “peso de ocho reales” meaning “piece of eight reals,” or simply “peso.”
Not surprisingly, one peso was worth eight of the now-defunct reales. In fact, in British America prior to the American Revolution, a Spanish milled dollar (peso) was referred to as a “piece of eight.”
How does this relate to the dollar symbol? It comes from the centrality of the number eight in the etymology of the peso. Some have speculated that the dollar sign is derived from a stylistic variation of the Arabic numeral “8.”
Though the theory makes sense, no documents have surfaced showing an 8 or its variants being used to symbolize the Spanish dollar.
3) The Straits of Gibraltar
Another intriguing theory comes from the coat of arms of the creator of the peso, King Ferdinand II of Aragon. During his reign, Ferdinand’s forces gained control of the Strait of Gibraltar.
It just so happens that the symbol used to represent the Pillars of Hercules in the strait is two columns wrapped by a ribbon, and Ferdinand added this to his coat of arms to memorialize his conquest. Many have noted a resemblance between this symbol and the dollar sign.
Supporting this theory is the fact that the symbol for the Pillars of Hercules has appeared on Spanish coinage. Indeed, one of the Chinese names for Spanish dollars was Shuangzhu, meaning double-pillar.
Notably, the most common peso coins circulated through Europe and the Americas were those minted at the Potosi mint in Bolivia, which contained this symbol.
However, though the pesos contained the symbol for the pillars of Hercules, there is little evidence of it being used to represent the coin itself.
4) The Mint at Petosi
Speaking of the mint at Petosi, it used as its mark the superimposed letters P, T, S, and I just as U.S. coins have a D, P, or S on them to denote where they were minted.
A large amount of the Spanish Empire’s silver was mined here, and, as we’ve already mentioned, coins minted at this site were among the most widely circulated. Some have speculated that the dollar symbol emerged from this marking.
5) Origin of the Word “Dollar”
Finally, it should be noted that the original name of the Spanish milled dollar was the peso. The term “dollar” came from the German Joachimsthaler or thaler, a large German silver coin similar to the peso.
The Dutch name for this was daalder, through which we get the word dollar. Therefore, it is conjectured that the dollar sign comes from superimposing an S and a J or an I and using it to denote the German coin. This would have then been adapted to the Spanish equivalent as well when it took the name.
6) Less likely theories
The murky origins of the dollar sign allowed some people’s imaginations to run wild and has led to a variety of less likely theories that have little or no evidence backing them, including the dollar symbol being:
- A design of patriot Robert Morris
- A combination of the Greek character psi and an S
- A monogram of US, with the letters U and S superimposed
- A brand used for slaves in Spanish territory consisting of an S with a nail through it. In Spanish, ‘clavo’ means nail and ‘esclavo’ means slave, hence S + clavo = esclavo
- The path followed by Umayyad general Tariq Ibn Ziyad in his 711 conquest of the Visigoth kingdom on the Iberian Peninsula. The S represents the path and the two bars through it represent the Pillars of Hercules that he crossed along the way.
The Symbol Today
Regardless of its origins, the symbol has become a worldwide way to denote wealth and money. In most places, the dollar symbol is placed before the amount (i.e. $5), though in French-speaking Canada it is placed after (i.e. 5$).
Additionally, it can be written with one or two strokes; there is no standardized difference except where otherwise mandated by law or customs.
Many countries use the dollar symbol in some form, including:
- United States (obviously)
- Canada
- Australia
- Hong Kong
- Argentina
- Bahamas
- Barbados
- Bermuda
- Cayman Islands
- Chile
- Colombia
- Fiji
- Liberia
- Namibia
- Singapore
Additionally, the symbol is used in encoding, programming languages, operating systems, and applications. It is also used to stylize names for branding or self-promotion, such as Ke$ha.
Sometimes, this stylization is used by critics to symbolize greed or a preoccupation with the pursuit of wealth above all else by replacing the letter S with a dollar sign, such as Di$ney or Micro$oft.
Conclusion
Thank you for joining us as we explored the origins of one of the most famous symbols in the world. Though we weren’t able to provide a clear-cut answer as to where this symbol comes from, that’s because none exists – no one really knows its true origins.
Nevertheless, we hope you enjoyed the ride and found some theories that you find reasonable.
We thank you for joining us and hope you’ll do so again. You can subscribe to continue exploring interesting, educational financial topics such as this.
