Like South Africa itself, gold Krugerrands have a storied history. As one of the most popular gold bullion coins on the market in decades past, its allure continues well into the twenty-first century. So, what are Krugerrands? Read on to find out.
History of the South African Krugerrand
British and Dutch expansionists of the colonial era struggled for supremacy over the southern tip of the African continent. Several conflicts sent the spoils of war from one national interest to the other over time. Then, one of the richest deposits of gold on the planet was discovered in 1886 in the Dutch-controlled Witwatersrand range of hills. Once revealed, the rush, and subsequent war for the territory, ensued. Ultimately, it ended up under British control.
In 1886, the President of South Africa, Paul Kruger, established the South African Mint Company Ltd. (SA Mint) to render the Witwatersrand gold into coins and bars. The rand is the currency of South Africa. As a tribute to Paul Kruger, respected as a statesman, the SA Mint began to produce one-ounce, legal tender coins with his portrait in 1967. Named the Krugerrand, these coins became so popular that they accounted for about 90 percent of the world’s gold coin market until 1990.
United States citizens, starving for gold acquisition since 1933, bought the Krugerrands by the millions. Although President Franklin Roosevelt had dictated a gold confiscation and criminalization of private ownership of American gold coins and bullion, a provision of the Executive Order permitted U.S. citizens to own foreign coins. At that time, however, they enjoyed little access to foreign coins. Thus, when the Krugerrands came on the scene at a time of rapid inflation and dollar devaluation, Americans couldn’t buy them fast enough.
Then, in 1985, President Reagan’s policies pressuring South Africa to abandon apartheid (South Africa’s version of official racial segregation) barred Americans from importing the Krugerrands. This took a pretty big toll on the SA Mint. However, in the mid-1990s, apartheid fell as an official government policy, and Krugerrands could now join the collections of American gold buyers once again.
Features
From the outset, the SA Mint decided not to stamp the Krugerrand with a face value. Rather, the value floats with the current spot price of gold bullion as the base value. The mint also produces fractional coins.
Gold Alloy Content. Krugerrands contain a gold/copper alloy that lends them a distinctive orange hue but also superior scratch resistance. However, each one-ounce coin contains the full one troy ounce of 22 karat gold.
Obverse. The obverse side features a remarkably accurate portrait of Paul Kruger by the engraver Otto Schultz.
Reverse. The reverse side highlights a design by Coert Steynberg of a springbok antelope, an iconic animal in South Africa.
Always Buy Krugerrands Locally from a Respected Dealer
During the import ban, many investors thrilled to the idea of owning a Krugerrand because of the possibility that it might have been illicit. Now, though, you can own them proudly without fear of official reprisals. If you would like to expand your gold investments to include Krugerrands, be sure to buy them from a trusted local dealer such as Roswell Gold, Silver & Coins. Please call us today to learn more about Krugerrands and other fine gold and silver investment products.