In a stroke of genius, South Africa created the Krugerrand gold bullion coin in 1967 to capitalize on the vast potential of the emerging private gold investment market. Struck from a durable 22-karat gold and copper alloy, the Krugerrand was designed for circulation as legal tender with its value tied directly to the spot price of gold.
The innovative idea was an unqualified success, buoyed by intensive promotion in America following the end of the ban on privately held gold. Despite sanctions and boycotts in protest of apartheid, and despite new competition from Canada, Krugerrands accounted for 90% of all gold bullion sales in 1980. The new market went on to consume over 1,700 U.S. tons of South African gold, indifferent to the Krugerrand’s strong symbolic ties to white minority rule.
Krugerrand is a conjunction of ‘Kruger,’ in reference to Paul Kruger, the last president of the old republic, and ‘Rand,’ the official currency of South Africa. The obverse portrays the president’s portly bust with the Afrikaans “SUID-AFRIKA” inscribed on the left and “SOUTH AFRICA” inscribed on the left.
The reverse features a galloping springbok, Afrikaans for “jumping antelope” and the national symbol of the old regime. “KRUGERRAND” is inscribed across the top, the date is split in the center, and the Afrikaans “FYNGOUD” followed by “1 OZ” and “FINE GOLD” – the coin’s denomination – is inscribed at the bottom.
In response to rising demand, in 1980 South Africa introduced Krugerrand denominations of 1/10 ounce, 1/4 ounce, and 1/2 ounce to compliment the one-ounce coin.
Due to the enormous quantity produced and to their excellent durability, Krugerrands still trade close to the gold spot price, and remain a sound and popular choice for gold bullion investment.
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