The National Currency Before the Federal Reserve

Here is the heart of the US currency system before the Fed. Pictured is a vault operated by the Office of the Comptroller of the Currency (OCC) in 1914, just a few months after the creation of the Federal Reserve.

At this time, the primary mission of the OCC was not auditing banks but managing the US National Currency also known as National Bank Notes. The National Banking System, overseen by the OCC, was established during the Civil War to create the national, reserve currency of the US. This currency was issued by private, national banks that deposited Treasury bonds with the US Treasurer as collateral. (Reminds us of stablecoins and proposed regulation a bit, doesn’t it?)

For the OCC, this meant coordinating the retirement and distribution of banknotes for national banks across the country. This work was headquartered in the Treasury building in Washington, DC.

In this photo, clerks are filling orders from banks for new notes. As can be seen, banks were sent sheets of notes printed by the Treasury. When a bank received its bundles of sheets, each note would have to be hand signed by the bank's cashier and president and then separated from the sheet.

It is easy to forget just how much physical labor was/is involved in the circulation of cash. We in the cryptocurrency world also need to remember that for many people, money is still a physical item with all that implies.