Gold Krugerrand History – The Story Behind the One Ounce Krugerrand

On July 3rd, 1967 the first 1 Ounce Krugerrand rolled through the presses in the South African Mint. This was not the beginning of the Gold Krugerrand, however- nor were the careful planning meetings of the Chamber of Mines of South Africa (who interestingly enough can trace its roots back to 1889) which lead to its creation.

In 1884, gold was found in the “ridge of white waters” (in Afrikaans Witwatersrand), South Africa. General Joubert remarked that the gold find will “cause our land to be soaked in blood.” In this blood and conflict begins the Gold Krugerrand history. Paul Kruger was the President of the Transvaal at this time, and he was very concerned with the influx of gold hungry foreigners who flocked to the sixty mile range of east/west running hills of Witwatersrand. Johannesburg sprang up first as a shanty town, and then eventually became a thriving city. As more foreign miners arrived- they began to want a say on how things were done- for example tax rates and where the taxes were spent. The Boers were concerned about losing their independence – rightly so, as the British empire was eyeing the rich gold find. The seeds of conflict were sown.

The second Boer war started in 1899 with ultimatums from the British demanding equal rights for the uitlanders (foreigners), and Kruger’s response for the British to be out of Transvaal in 48 hours. After three bloody years, the war ended in 1902 and Transvaal was absorbed into the British empire- with some concessions to the Boers.

Politics settled, the march of the Krugerrand carried on. A Krugerrand would be nothing without that heart of precious metal- refined gold bullion. In 1920 the Transvaal Chamber of Mines needed a consolidated refinery to handle all the gold in South Africa. The Rand Refinery was created to meet this need, and has been in continuous operation every since.

The 1 Ounce Krugerrand takes its name from a combination of Paul Kruger’s surname, and the Rand, which is the currency of South Africa (the Rand was taken from Witwatersrand). The obverse of the 1 oz Krugerrand has a portrait of Paul Kruger, designed by Otto Schultz. Coert Steynberg designed the reverse, which is a Springbok antelope, a national symbol of South Africa.

With Executive Order 6102 and the Trading with the Enemy Act of 1917, United States citizens were effectively barred from owning gold bullion. In 1967 the Chamber of Mines of South Africa had a clever plan for their fledgling One oz Krugerrand. By declaring the coin legal tender of South Africa, it was classified as “foreign coin”, and US citizens could buy it. They also had another trick up their sleeve, instead of putting a value on it- they put the weight of the gold bullion on the coin. This allowed a quick and easy method to trade gold bullion without the need to melt and assay its gold content. This also tied the value of the Krugerrand directly to the underlying gold value. It’s interesting to note that Krugerrands are not 24 carat gold- they are alloyed with copper which gives them their dark golden color and adds strength. Rest assured however, that they do contain one full ounce of gold bullion. Until apartheid was abolished in the middle of the 1990s, it was still illegal to import Krugers in western countries. In spite of this the Kruger was still a commercial success. Forty-six million ounces later, it is remains the world’s most popular bullion investment coin. The One oz Krugerrand history leads from the rolling hills to the highest political offices, and beyond.