The South African Krugerrand

The Krugerrand was the first bullion coins to be tenderable at the market value based on its gold content, by comparison, the earlier gold coins such as the British sovereign are tendered at the face value on the coin, which can be very different from the value of its gold content. Hence Krugerrands are often regarded as the first "bullion coin" minted worldwide.

The Krugerrand originated from the Republic of South Africa in 1967, where it enjoys legal tender status. By bestowing legal tender status on the Krugerrand, it allows the coin to be imported into many, if not all countries without being subjected to import taxes, duty or VAT. However due to the Apartheid policies in South Africa at that time, many Western countries prohibits the ownership and import of Krugerrands. This embargo have since being revoked after the political reform in 1994.

The Krugerrand was perhaps not among the most beautiful coin ever minted, this is due to the fact that the Krugerrand was regarded as a bullion coin rather than a numismatic coin, it is intended as a vehicle for private gold ownership rather than as a collectible numismatic item. The South African government created it as a means to market the vast deposit of gold that South Africa has. Hence you can buy Krugerrand at a much lower premium as compared to other gold bullion coin, where it fetched a premium of 5% over the base gold value when it is first issued, and today you can buy Krugerrand at a premium less than one percent above the market prices of its gold content.

When it was first issued, the Krugerrand is only offered in one troy ounce denomination with no face value printed, today Krugerrands are offered in multiple denominations including 1/2 oz, 1/4oz and 1/10 oz.