WHAT ARE TOKENS?

Definition
Tokens are coin-like, sometimes quasi-monetary items that usually look similar to coins, but were not issued by a legal government minting authority. Tokens include items such as:

• Arcade tokens such as those used to play games in an arcade
• Commemorative "coins" issued by private mints in base metals and precious metals
• Hard Times tokens that were issued during the period from 1834-1844 by private merchants, companies, and banks to fill the need for token coinage during a national banking crisis
• Civil War tokens that were issued by companies, merchants, and banks to fill the need for token coinage during the U.S. Civil War.
• Challenge Tokens (aka Challenge Coins) usually issued by one of the branches of the United States military in order to prove membership in the organization when challenged
• There are also many other types of non-official, coin-like objects that fit into the generic (non-numismatic) definition of "tokens".

Coins Versus Tokens
The key differentiator between a coin and a token is that coins are of legal tender in the country that issued them. This means that a country passes legislation authorizing the production of currency to facilitate commerce. This can consist of coins and paper money. The currency is usually marked with a denomination that indicates its value.

Tokens on the other hand can be issued by any person, private company or organization. They are not of legal tender status since they are not issued/authorized by a country. Tokens may indicate a value or equivalent good or service.

For example, "Good for One Carwash", "Value 25 Cents at ABC Company", or "Good for One Videogame Play".

In the United States, tokens cannot have any indication nor appear to be issued by the United States. This may include not using the words "United States" and indicating a denomination. This is specifically defined in the United States Constitution (Article I, Section 10, Clause 1).

Collecting Tokens
Since tokens have been issued by such a wide variety of people, companies and organizations there is no definitive resource that catalogs all tokens ever issued. However, there have been publications that have covered Civil War Tokens and Hard Times Tokens.

Many people collect tokens by theme or topic. One popular theme is to collect game tokens from video gaming arcades. Another one is to collect Challenge Tokens that pertain to a particular branch of the military. For example, challenge tokens from the United States Army.

To read the complete article, see:
Tokens - What are Tokens? (http://coins.about.com/od/coinsglossary/g/coin_tokens.htm)

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