The Gold Krugerrand is one of the most recognized and trusted gold bullion coins in the world. First minted in 1967, this iconic coin was designed to offer investors an accessible and convenient way to own gold. Its name, purity, and composition reflect South Africa’s rich gold history and strategic approach to gold investment. In this piece, we answer some of the most commonly asked questions about the Gold Krugerrand coin, revealing why it remains a leading choice for gold investors worldwide.
As revealed in the Krugerrand’s historical timeline, the South African gold coin took its name from “The Rand,” a slang term referring to the world’s most gold-rich area from which its content was sourced. “The Rand” was the name given to the Witwatersrand plateau, which in Afrikaans literally means “white waters’ ridge.”
There were three important reasons why South Africa chose one troy ounce as the gold content of its pioneering coin. First, it was slightly larger than some popular gold coinage hoarded in Europe and elsewhere at the time, such as the US Double Eagle and Austrian 100 Corona, yet still a perfectly acceptable size as gold currency. Second, the larger format meant lower costs of production while maintaining prices close to melt value. Lastly, the Krugerrand was designed as legal tender with a value of one troy ounce, matching the standard unit of measurement in global gold markets.
Although the gold Krugerrand was officially government-backed legal tender, it did not display a currency value imprinted in Rand. Instead, its legal tender status was based on one troy ounce of gold, the standard measure for valuing gold bullion. The London bullion markets, which quoted gold prices in troy ounces, were the world’s primary source of value, and therefore, the basis for the Krugerrand’s value. As a result, the Krugerrand could be exchanged at its legal tender value, based on the daily London quoted price of gold. It remains the only legal tender bullion coin with its face value denominated in ounces of pure gold, and is guaranteed by the South African Reserve Bank to be exchanged at gold’s fixing price of the day.
Krugerrands consist of 22k gold, or 91.67% pure gold, with copper alloy added to improve durability. This composition was chosen for several important reasons. When the Krugerrand was conceived in 1967, it was considered a legal tender bullion coin. The gold investment market at the time played a key role in determining its composition. In the early to mid-20th century, preserved monetary gold coinage was a significant part of gold investing for individuals, banks, and governments. The most widely recognized and accepted gold coins at the time included:
These coins typically had a 90% gold purity, with the British Sovereign being made from 22k (91.67% gold). In fact, the demand for gold coins in the 1960s was so great that it led to the production of pre-1933 “restrikes” to meet investment demand, especially in markets like the United States where these collectible coins were not prohibited. One notable example of this was the Austrian Mint’s 100 Corona coins, which were dated 1915. This was the market environment in 1967 when the Krugerrand was introduced.
Although much was stockpiled, gold coinage changed hands frequently and needed to endure over time. Pure 24-karat gold is soft and malleable, which makes it less ideal for coinage in circulation. To equip the coins against wear, all gold coins up to that point included a measure of alloys, with copper being the most common.
Because South Africa was part of the British Commonwealth, and since British gold coins were some of the purest—in fact, sovereigns were struck in South Africa from 1923 to 1932— it made sense for the country to align with the same 22k (91.67% gold) purity as British coins like the Sovereign. However, South Africa made the monumental decision to have the Krugerrand contain exactly one troy ounce of fine gold—more than four times the gold content of the Sovereign, having the odd content of .2354 of weight in pure gold. This decision ensured the Krugerrand could be easily valued at the London market’s quoted spot price for its legal tender value, making it a straightforward and globally recognized gold investment.
The Gold Krugerrand is precisely one troy ounce of fine gold, with a composition of 22k (91.67% gold) and weighing 1.09 troy ounces (33.93 grams). The diameter of the coin is 32.77 mm (1.28 inches), and its thickness is 2.84 mm (0.11 inches). The Krugerrand gold coin feels more compact and thicker compared to typical coins, resembling an ingot. This design is fitting for its producer, Rand Refinery, known worldwide for its bullion bar production.
The Krugerrand, the world’s first one-ounce gold bullion coin, was created to provide a convenient way for individuals to invest in gold. Its design, purity, and composition were influenced by the market demands and South Africa’s rich gold history.
Let’s take a final look at the key elements that define this remarkable coin:
Krugerrand Introduction
Name Origin
Legal Tender
Purity and Weight
Dimensions
Design and Feel
Buying Gold Krugerrand coins from Monex is simple. Contact one of our experienced Account Representatives to discuss your investment goals and place an order. With our secure, two-way buy-sell market, you can easily purchase Krugerrands and have them delivered directly to you or securely stored. Reach out to Monex today to add this iconic gold coin to your investment portfolio.
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