The final penny, nominally worth $0.01, was minted Wednesday by the United States Mint in Philadelphia, Pennsylvania, ending 232 years of minting and circulating new pennies.
U.S. President Donald Trump directed the U.S. Treasury Department in February to halt production of the penny, and the Treasury initially set a goal for the last mint in 2026. However, the Treasury Department ran out of templates used to produce the coins between June and September, according to Axios.
A penny costs about 3.7 times its face value to produce, meaning a $0.01 coin actually costs more than $0.03.
Although it is economically impossible to mint any more U.S. pennies, the coin will remain legal tender, with over 250 billion physical pennies remaining in circulation.
Alexander Leishman, CEO of Bitcoin financial services company River, said of the 1 Bitcoin (BTC) subunit: “Inflation has made a penny useless, while satellites are becoming more and more meaningful every year.”
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Bitcoin as a solution to fiat currency value erosion
Bitcoin was created as an alternative currency system with a supply limit of 21 million coins. This means that as the demand for BTC increases, the price per coin must also increase.
According to author, economist, and BTC supporter Saifeddine Amos, technological development is a deflationary force, making production processes more efficient and lowering the prices of goods and services over time.
In contrast, fiat currencies are less able to capture this price deflation because their supply is constantly increasing and their purchasing power decreases over time, which is reflected in the rising prices of goods, assets, and services.
In other words, the prices of goods and services have not increased. According to Amos, the value of fiat currencies has declined relative to goods, services and real assets.
Economists argue that if these same goods, services, and assets were denominated in BTC or other hard money standards, their prices would fall over time.
The U.S. dollar has lost more than 92% of its value since the creation of the Federal Reserve System in 1913, according to precious metals dealer The Gold Bureau.
Meanwhile, Bitcoin hit an all-time high of more than $126,000 in October, while the U.S. dollar suffered its worst year since 1973, according to market analysts at Covisi Letter.
“The U.S. dollar has lost around 40% of its purchasing power since 2000,” Covissi Letter said in October, adding that it had lost more than 10% of its year-to-date value as of October.
But economist Paul Krugman, who has long been critical of cryptocurrencies and BTC, said the dollar’s power lies in how easy it is to use compared to BTC, which is difficult for the average person to own and trade.
“The whole point of the dollar is that it’s very easy to use, but Bitcoin is difficult to use,” Krugman told podcast host Hasan Minhaj.
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