Historical Sketch

Christopher Columbus discovered the main island for the Europeans in 1493 and named them "Islas de once mil virgines". In the early 17th century, the islands came under Dutch authority until 1672, when they were passed to Denmark (western part) and England (eastern part). The British Virgin Islands were part of the Leeward Islands colony. After the disintegration of the West Indian Federation, they became a separate British possession in 1962.

Monetary History Overview

The Caribbean had always been an important station on the trade routes between the Spanish American possessions and Europe. Thus, Spanish trade coins got introduced and dominated the payment transactions, predominantly the so-called "Spanish Dollar", the eight Reals in silver. The isolation of the islands brought scarcity of specie and thus caused an overvaluation of the trade coins compared with the European markets. In the English possessions, various "accounting Shillings" emerged which were determined by the local valuation of the Spanish trade coins, differing considerably from the metropolitan rating of 50 Pence Sterling per Spanish Dollar. In 1825, the Pound Sterling became the sole currency for all British possessions. The dominance of Spanish trade coins in payments did not change for the time being. In the mid-19th century, however, the local accounting currencies were abolished everywhere, which corresponded to a massive devaluation of the local money. In British Virgin Islands (Tortola) this was done in 1847, and as the Spanish Dollar had been traded at 100 Pence, it amounted to 50%. The foreign coinage was tolerated in payments until the late 19th century, and the name "Dollar" remained in customary use for an amount of 50 Pence Sterling, the former rate of the Spanish Dollar. In the 1930s, the British Virgin Islands came under the authority of the Barbados Currency Board. Since 1951, the monetary affairs were handled by the British West Indian institutions. The close economic ties with the United States, particularly the neighbouring United States Virgin Islands, spurred public pressure on the colonial government to adopt the US currency. In 1958, the accounting was changed from the British West Indian Dollar to the US Dollar, and three years later, the United States Dollar was introduced as circulating medium. The British West Indian currency was withdrawn until end 1961. In 1973, the British Virgin Islands have amended their coinage laws to issue subsidiary coins in US currency. They are legal tender but intended for collectors rather than general circulation.

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