The End of the Penny: What It Means for Silver, Currency, and Everyday Americans
The U.S. is ending penny production. Discover what this means for silver markets, collectors, and the future of American coinage with Si Iver.
By David Downs, Numismatist for Si Iver
The humble penny, once a fixture of every American pocket, gumball machine, and tip jar, is facing extinction. In May 2025, the U.S. Treasury Department announced it is winding down production of the one-cent coin after ordering its final batch of blanks. This decision marks the end of a monetary era—and presents both challenges and opportunities for industries closely tied to coinage, including precious metals dealers and collectors.
For those of us in the silver community, the news reverberates beyond economics. Currency decisions ripple through metal markets, shape collecting behavior, and reflect shifting national attitudes toward value. Let’s unpack why the penny is disappearing, how this move aligns with broader trends, and what it could mean for silver enthusiasts and dealers alike.
Why the Penny Had to Go
The rationale is simple: the penny costs more to make than it’s worth—a lot more.
According to the Treasury Department, it now costs 3.69 cents to manufacture a single penny. That’s a nearly 300% increase over the last decade, up from 1.3 cents in 2015. With over 3 billion pennies produced in 2024 alone, taxpayers were effectively spending over $110 million annually on coins that collectively held just a third of that value.
At the heart of the issue is inflation and raw material costs. Today’s pennies are made of 97.5% zinc and 2.5% copper plating—a shift from the earlier days when they were predominantly copper. Yet even this cheaper alloy has seen rising input costs. Energy-intensive mining, global metal price fluctuations, and logistics bottlenecks have all driven up manufacturing expenses.
President Trump’s recent executive directive to halt penny production framed it as a cost-saving measure. It’s estimated that eliminating the penny could save taxpayers at least $56 million a year, not including additional efficiencies gained by repurposing Mint facilities.
A Currency’s Slow Decline
While the White House's directive may seem abrupt, the penny’s demise has been long in the making. Production has steadily declined from 9.36 billion coins in 2015 to just 3.22 billion in 2024.
Once a vital part of small purchases, the penny’s purchasing power has eroded. What could buy a candy bar in the 1940s won’t even cover the tax on a modern-day one. With inflation steadily eating into coin value, the penny has become more symbolic than functional—useful perhaps for tradition, but inefficient for commerce.
Today, there are roughly 114 billion pennies still in circulation. However, that number is expected to dwindle as the Mint uses up its remaining blank stock and ceases production. Soon, cash-based transactions may round prices to the nearest nickel—a practice already common in countries like Canada, which phased out its own penny in 2012.
Nickels Are in the Crosshairs Too
If you're wondering whether the nickel is next on the chopping block, you wouldn’t be wrong to ask. Though it’s a 5-cent coin, the nickel costs about 13.78 cents to produce—nearly triple its face value.
For 19 consecutive years, both nickels and pennies have cost more to make than they’re worth. Though the Treasury hasn’t announced plans to eliminate the nickel, industry insiders are watching closely. If the penny’s phaseout goes smoothly, the nickel might follow.
Implications for Coin Collectors and Silver Investors
While the penny itself contains no silver and little copper in its modern form, the psychological effect of currency elimination often has a knock-on impact on collectible and precious metals markets.
“When a coin exits circulation, collectors scramble to preserve history,” said David Downs, Numismatist for Si Iver. “But it’s not just nostalgia—it’s an investment opportunity. Scarcity changes the market overnight.”
With the spotlight now on America’s coins, collectors are already snapping up pre-1982 pennies (which contain 95% copper) for their melt value, which can exceed face value several times over. Though it’s illegal to melt pennies for scrap, the potential long-term premium on these coins is attracting attention.
Moreover, this shift could bolster demand for sound-money alternatives, particularly physical silver. As fiat coins become less practical and more expensive to maintain, many investors may once again turn to precious metals as a hedge against inflation and currency debasement.
“We saw this happen when silver was removed from circulating dimes and quarters in the '60s,” Downs added. “Public trust in coins fell, and silver saw a resurgence as a real store of value.”
Will Silver Replace Small Change?
Not literally, of course. But the symbolism is powerful. Silver has long stood as an emblem of monetary discipline. In fact, U.S. dimes, quarters, and half dollars minted before 1965 contained 90% silver—an era many sound-money advocates view with nostalgia and respect.
With today’s coins no longer backed by precious metals, and even minor coinage becoming economically irrational, a growing number of Americans are rethinking how they store value. This could be a moment of reawakening for silver, not just as an investment, but as a principled stand.
What It Means for Si Iver and Fellow Dealers
For silver dealers like us at Si Iver, the end of the penny provides both opportunity and responsibility.
Educational Engagement: We must help our clients understand what these changes signal about inflation, currency credibility, and monetary policy. The disappearance of a coin may feel trivial—but it’s a bellwether of deeper issues in fiat-based economies.
Numismatic Opportunities: Expect heightened interest in vintage coins, pre-1982 copper pennies, and discontinued coin sets. Dealers should be ready to advise collectors and investors on scarcity, grading, and long-term value.
Silver Promotion: As coinage gets cheaper and less durable, the value of real metal becomes more tangible. Silver rounds and bullion may now resonate more with clients who traditionally only held dollars and cents.
Portfolio Rebalancing: This is also a chance to speak with clients—especially those concerned about inflation or retirement—about rebalancing into hard assets. Whether through self-directed IRAs, family offices, or defined benefit plans, silver remains an attractive hedge.
Rounding Out the Future
As pennies fade from cash drawers and coin jars, their symbolic departure leaves us with important questions:
What is the true cost of currency?
When does convenience outweigh tradition?
And how can individuals protect their wealth in a time of rising production costs and vanishing coinage?
For some, it’s simply about rounding to the nearest nickel. For others, like us at Si Iver, it’s a clarion call—a signal to re-center around real value, historical perspective, and the enduring worth of silver.
Because when the smallest coin disappears, it’s often a sign we should think bigger.
About the Author:
Si Iver is a leading precious metals dealer specializing in silver coins, bullion, and retirement metals strategies. Known for blending historical insight with practical investment advice, Si Iver helps clients preserve wealth through sound-money principles.
David Downs is a numismatist for Si Iver and lifelong Padres fan.