{"id":30997,"date":"2016-04-04T20:33:41","date_gmt":"2016-04-05T01:33:41","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/constitution\/article1\/annotation37.html"},"modified":"2024-08-02T13:18:52","modified_gmt":"2024-08-02T18:18:52","slug":"annotation37","status":"publish","type":"constitution","link":"https:\/\/constitution.findlaw.com\/article1\/annotation37.html","title":{"rendered":"Congress’s Power to Regulate Currency"},"content":{"rendered":"\n
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Congress's Power to Regulate Currency<\/h1>\n
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\n By Samuel Strom, J.D.<\/a> | Legally reviewed by Edward Maggio, Esq.<\/a>\n | Last reviewed\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

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Article I, Section 8 enumerates Congress’s powers, including coining money and regulating currency. It also confirms that Congress can punish anyone who produces counterfeit money. <\/p>\n\n <\/div>\n\n

The Constitution grants Congress authority over the currency of the United States, encompassing the powers to mint money and determine its value. Additionally, Congress has the authority to establish banks and manage the circulation of money. A corresponding power to the creation of currency is the regulation of counterfeit currency.<\/p>\r\n

The Powers of Congress: Article I, Section 8<\/b><\/h2>\r\n

Article I, Section 8<\/a> of the Constitution<\/a> enumerates Congress\u2019s powers. The powers regarding currency include the following:<\/p>\r\n

"The Congress shall have the power to . . .<\/i><\/p>\r\n

[5] To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;<\/i><\/p>\r\n

[6] To provide for the Punishment of counterfeiting the Securities and current Coin of the United States;"<\/i><\/p>\r\n

Congress also has the power to regulate commerce with foreign nations and between the several states. Moreover, it can borrow money on credit for the United States.<\/p>\r\n

Congress and Currency<\/b><\/h2>\r\n

Article I, Section 8, Clause 5 is known as the coinage clause. It gives Congress the exclusive power to coin money. The Supreme Court has also interpreted clause 5 as giving Congress the sole authority to regulate every aspect of United States currency<\/a>.<\/p>\r\n

The Supreme Court case McCulloch v. Maryland<\/i><\/a> (1817) also gives Congress the power to charter banks. In addition, it can give banks the power to issue circulating notes (e.g., coins, banknotes, and government notes).<\/p>\r\n

The Supreme Court has ruled that Congress can levy taxes on banknotes<\/a> issued by state banks or \u201cmunicipal corporations.\u201d This allows Congress to restrain currencies not issued under its own authority.<\/p>\r\n

Counterfeiting<\/b><\/h2>\r\n

Article I, Section 8, Clause 6 is known as the counterfeiting clause. The Supreme Court has interpreted it to mean that Congress prohibits the creation<\/i> of counterfeit coins or money. However, clause 6 does not ban the use<\/i> of counterfeit money in financial transactions. (Fox v. Ohio<\/i><\/a> (1847)).<\/p>\r\n

As the Constitution Annotated notes, the Supreme Court has ruled that the counterfeiting clause does not limit the power of the states. Indeed, states can punish people or entities that use counterfeit money.<\/p>\r\n

Congress can also pass federal laws that punish the importation and use of counterfeit money. In United States v. Marigold<\/i><\/a> (1850), the Court wrote that Congress\u2019s ability to coin money includes \u201cthe correspondent and necessary power and obligation to protect and to preserve in its purity this constitutional currency for the benefit of the nation.\u201d<\/p>\r\n

Related Powers<\/b><\/h2>\r\n

The coinage and counterfeiting clauses are related to several other powers of Congress. These include the following:<\/p>\r\n