Krugerrand History

The Chamber of Mines of South Africa was formed in 1889 to represent mining employers and make decisions for the gold interests of South Africa. They were the planners behind the One oz Krugerrand, however the history of the Krugerrand goes further back- well beyond it’s first mintage in July of 1967.

Witwatersrand, South Africa or the “ridge of white waters” in Afrikaans, is truly where Gold Krugerrand history starts. These mineral rich hills run east to west near Johannesburg for over sixty miles. They produce many minerals including uranium- and in 1884 the first gold discovery was made. The president of the Transvaal at that time was Paul Kruger, who knew that the gold discovery would forever change the face of South Africa. As he predicted, the rich gold find brought in many foreign miners looking to make their fortune. As more and more foreigners entered, they eventually began to outnumber the Boers, and their protests for their rights lead to increasing levels of conflict. Underlying this concern for their rights, was the British desire to control gold rights.

In 1899, the British government demanded Uitlander (foreigner) rights to match those of the Boers. Realizing that the British wanted more than equal rights (Transvaal independence was at stake), Paul Kruger responded that all of the British should leave within 48 hours. This was an impasse which could not be broken via diplomatic means, and the second Boer War ranged across the country. The Boers fought hard and were able to demand some concessions at the war’s end in 1902, but the Transvaal independence was lost.

Now that the drums of war were silent, the next milestone in the timeline of Gold Krugerrand history was the creation of the of a centralized refinery. The Transvaal Chamber of Mines created the Rand Refinery in 1920 with the express goal to refine all the gold mined in Witwatersrand. To this day, the blank every South African Krugerrand is stamped on comes from the Rand refinery.

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.

In 1967 when Krugerrands were first produced, the United States government prohibited its citizens from owning gold bullion, but allowed ownership of foreign coins. The 1 oz Krugerrand was a brilliant piece of marketing for two reasons. One, it was the first bullion coin to be traded for its gold content, rather than a denomination on the coin (a 1 oz gold Krugerrand is 22 carats, 11 parts gold to 1 part copper- however it does contain one full ounce of gold bullion). As the price of gold fluctuates, so goes the price of Krugerrands. Second, by making the Krugerrand legal tender, it allowed American investors to purchase the coin. This allowed everyday people to buy gold without the need to have it melted and assayed. The South African Krugerrand was declared illegal to import in many Western countries during the 1970s and 1980s due to the policy of apartheid. With South African political reform from 1990 to 1994 and the abolishment of apartheid, one ounce Krugerrands became legal imports to the U.S. Even with the previous prohibitions, Krugerrands are the most popular gold bullion coin- with over forty-six million ounces in circulation. The One Ounce Krugerrand History is peppered with blood, politics, and ingenuity.