The Coinage Act 1816 (56 Geo. 3. c. 68), also known as the Coin Act 1816 or Liverpool’s Act,[1] defined the value of the pound sterling relative to gold, moving the UK from its previous bimetallism and towards the adoption of a gold standard. One Troy pound (373 g) of standard (22-carat) gold was defined as equivalent to £46 14s 6d.[2]
The government was facing a scarcity of small change, and in response decided to abandon the idea of bimetallism – the simultaneous circulation of gold and silver coins – and instead adopted a single gold standard. Silver coins were reduced to the status of tokens, their continued existence necessary because gold coins for small values would be tiny. But silver coins were no longer considered to be legal tender for transactions in excess of forty shillings.[3]
The UK left the gold standard in 1931.[4]