What Are Goldbacks? Are They Legal Tender?

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Contributor, Benzinga
November 3, 2023

The United States abandoned the gold standard more than 50 years ago and while this was likely unavoidable, it's not hard to see why so many people want it back. It will probably never return on a federal level, but an innovative company called Goldback Inc. is trying to bring it back on some level.

Instead of using extremely expensive gold coinage or other precious metals, Goldback takes the concept of a gold standard to the next level. Its currency (also called the Goldback), is made with gold, giving each note at least the intrinsic value of the gold inside.

What Are Goldbacks?

Goldbacks are made of 24-karat gold foil, which is laminated onto a sturdy polyester film. This means that they are durable and long-lasting, potentially making them an excellent investment for those looking to hold onto gold long-term. A 1 Goldback note has 1/1000 troy ounces of gold in it, and the bills come in denominations of 1, 5, 10, 25 and 50 Goldbacks.

The gold content in each note is measured, so you can be sure that you are getting the full value of your investment. Additionally, each Goldback is decorated with unique, intricate designs that reflect the local culture and heritage of the area where they are issued.

Investing in Goldbacks could be an excellent way to diversify your portfolio and protect your assets. It could also just be a fun collector's item. With their stunning designs, 24-karat gold content and status as a legal tender in four states, Goldbacks are an investment option that is truly one-of-a-kind.

If you're considering investing in Goldbacks, you’ll want to understand their legal status. While these gold-based notes are legal tender in four states — Utah, Nevada, Wyoming and New Hampshire — they are not accepted as legal tender by the federal government.

What does this mean? Essentially, legal tender refers to the money that a government has declared as acceptable for payment of debts and taxes within its jurisdiction. This is why you can use U.S. dollars to pay for goods and services anywhere in the United States, for example.

While Goldbacks are legal tender in Utah, Nevada, Wyoming and New Hampshire, they can’t be used at every shop or restaurant in these states. However, a surprisingly large number of businesses in all three states accept the notes.

While Goldbacks are not accepted as legal tender by the federal government, they are still considered a legitimate form of currency in the states where they are accepted. They can be used to purchase goods and services from businesses that accept them, and they can be exchanged for U.S. dollars at certain locations.

Ultimately, the legal status of Goldbacks is a bit complex. While they are not accepted as legal tender by the federal government, they are still considered a valuable investment option by many individuals and businesses because of their gold content. 

What's the Point of Goldbacks?

Ok, Goldbacks are pretty cool, but what's the point? For starters, they offer a level of independence that traditional currency can't match. Unlike digital dollars, euros or any other fiat currency, Goldbacks do not require the approval of a central authority to spend. You are free to use them as you see fit, without restrictions on where or how they can be spent. The worth of Goldbacks is also not tied to a government, just the price of gold.

Another key benefit of Goldbacks is their anonymity. You don’t have to provide personal information when using Goldbacks, which means that your transactions are not recorded or tracked in any way. This feature makes Goldbacks a popular option for individuals who value their privacy and want to keep their financial transactions confidential.

Goldbacks are also versatile. They can be spent, traded or purchased with no fees, making them a cost-effective option for anyone looking to manage their money more efficiently. 

Additionally, because Goldbacks are physical notes, they can be quickly counted to know exactly how much you have on hand, making them an ideal option for small business owners or anyone looking to keep track of their finances.

One of the biggest advantages of Goldbacks is that they cannot be frozen in your account by a payment processor. Goldbacks are not a counterparty instrument, meaning that they are not subject to the same risks as digital currencies that rely on third-party intermediaries to facilitate transactions.

Overall, there are many reasons why individuals and businesses are turning to Goldbacks as a secure, private and cost-effective alternative to traditional currency. Whether you're looking to invest in gold-based notes or want a more independent way to manage your finances, Goldbacks offer a wide range of benefits that make them an attractive option for anyone looking to take control of their money.

How to Buy Goldbacks and Gold Bullion

Goldbacks are new, but you can still buy them from a few of the top precious metals dealers. One of the best is Birch Gold Group, which is a leading gold and precious metals platform with unmatched educational resources and a great selection. It also offers precious metals IRAs with a relatively low minimum investment requirement. While Birch Gold doesn't yet support Goldbacks in IRAs, you can still have them delivered to you directly, assuming they are still in stock.

If you just want to buy gold, silver, platinum or palladium coins or bullion, you can choose from a number of great precious metals dealers. Here are a few of the best on the market with low fees, great customer service and wide selections of precious metals products (+ precious metals IRA support and rollovers). 

You might also consider using Augusta Precious Metals if you want to invest in gold, silver or try a precious metals IRA. The company has a robust knowledge center that can help answer your questions, or you can speak with their customer service team to learn more about goldbacks and how they might enhance your portfolio.

Oxford Gold Group makes it easy for you to get the information you because you can schedule with a gold expert right from the homepage if you have questions about goldbacks. Plus, you can check out educational articles, read current news articles, review precious metals charts, track prices and even take delivery or schedule the storage of real gold and other precious metals.

Those who try Lear Capital can speak with an expert if they want to learn more about their precious metals investments. With more than 25 years in the business, the firm also offers the Lear Advantage IRA for those who want to save for the future using goldbacks or other precious metals investments.

Is it a Good Idea to Buy Goldbacks?

If you're considering investing in Goldbacks, weigh the pros and cons before making a decision. It may be a good idea to buy Goldbacks, but that depends on what you expect from them. If you want a cool collectible, a gold-backed local currency and a safe haven investment all rolled into one, Goldbacks are probably perfect for you.

However, if you want to use it as your daily currency, especially if you live outside of New Hampshire, Utah, Nevada and Wyoming, it's probably an unwise idea to buy Goldbacks. Most businesses just don't accept them yet.

Frequently Asked Questions


Are Goldbacks a good investment?


Goldbacks can be a good investment for diversifying your portfolio. However, it is important to note that the value of Goldbacks is tied to the price of gold, which can be volatile. Investing in Goldbacks may not provide the same level of liquidity as other traditional investment options.


What is the purpose of Goldbacks?


The purpose of Goldbacks is to provide a local, community-based currency that promotes economic stability and supports local businesses. Goldbacks are designed to circulate within a specific region and encourage local spending, helping to strengthen the local economy and create a sense of pride and unity within the community. Additionally, Goldbacks aim to provide an alternative form of currency that is not subject to the same fluctuations and risks as traditional fiat currencies, offering a more stable and secure means of exchange.


How are Goldbacks legal?


Goldbacks are legal because they are backed by the government and are recognized as a form of currency. They are produced by authorized mints and are subject to regulations and laws governing currency.

About Henry Stater

Henry is an expert in all things crypto. He stays up to date with all the latest coins, platforms and technologies in the field. He has particular expertise in the burgeoning decentralized finance ecosystem and loves trying out all the new platforms. He also always follows major events in other financial markets and geopolitics as a whole, especially when an event’s effects ripple through the crypto market.