Private Minting Coin Problem — The Dark Side of 'Bita-sen' Shaking Medieval Japan's Economy

At the end of the 13th century, Japan was in a tumultuous era with the samurai-dominated Kamakura period nearing its end. Beneath the surface, commercial activities gradually became more vibrant, and a monetary economy quietly began permeating urban areas. The economy, which was primarily based on barter, saw an influx of 'Toraisen', particularly 'Song coins' from China, from the late Heian to the Kamakura period. Through Japan-Song trade, these coins like Yongle Tongbao and Hongwu Tongbao, considered ancient currency, significantly met the currency needs of Japan at the time. However, entering the 14th century, with recurring internal strife such as the Mongol invasions and the Nanboku-chō conflict (1336-1392), the domestic production system became chaotic, and the supply of imported coins became unstable. Particularly during the late 14th to early 15th centuries when Ashikaga Yoshimitsu reigned as the shogun of the Muromachi Shogunate, the increase in Ming coins through tribute trade temporarily alleviated the situation, yet it was insufficient to meet nationwide currency demand. In major cities like Kyoto, Nara, Hakata, and Sakai, commercial activities soared, and coins became indispensable as a means of payment, replacing rice or cloth. For example, in 15th century Kyoto, it was common for 1 koku of rice to be traded for 1,000 to 2,000 coins. In this scenario, central powers like the court or shogunate lacked the capacity to mint and supply a unified currency themselves. Although there was a time during the Heian period when official coins like the Wado Kaichin were minted, this had since been discontinued. Faced with a currency shortage, merchants and lords across regions took the bold step of manufacturing coins themselves to break out of this predicament. This was the initial stirrings of the 'private minting' that would later plunge the Japanese economy into chaos. They believed that by imitating imported coins, they could easily supply currency.

The growing demand for currency and the lack of central control in rural areas created a hotbed for private minting. From the 14th to the 15th century, groups known as 'coin shops' or 'casters' started appearing in places like Sakomoto in Omi Province (present-day Otsu City, Shiga Prefecture), Kawachi Province (present-day eastern Osaka Prefecture), and Tanba Province (present-day central Kyoto Prefecture and eastern Hyogo Prefecture), manufacturing private minted coins mimicking imported coins, especially Song and Ming coins. These groups used casting technologies like sand mold casting to produce large quantities of coins modeled after authentic coins. However, the quality of these coins was mixed. Originally, coins were primarily composed of copper, but the private minters, aiming to maximize profits, mixed in cheap lead and tin. For instance, while the copper content in typical Song coins was about 70-80%, there were bita coins where lead and tin accounted for over 50%, making the coins brittle with unclear inscriptions or prone to chipping. The rough quality of the script, sometimes with misspellings, contributed to the coined term 'bita-sen' for low-quality coins. The production of private minted coins involved not only professional casters but occasionally influential local lords and temples participated as well. There are records that warlord Mōri Motonari encouraged private minting within his domain during the Sengoku period, using them for local economic revitalization or military funding. The secretive or sometimes blatant minting operations, often conducted under the cover of night, led to enormous production. Records suggest that by the mid-15th century, more than half of the coins circulating in the market were private minted, underscoring their significant influence. These clues on identifying fakes and forgeries are valuable knowledge even for contemporary collectors.

The rampant private minting of coins caused severe chaos in medieval Japan's monetary economy. With markets flooded by high-quality imported coins 'Seisen' and poor-quality private minted 'Bita-sen', disputes over coin quality erupted frequently during commercial transactions. Merchants accepting bita-sen as payment suffered actual losses due to their reduced value. As a result, people practiced 'Eri-zeni', meticulously selecting coins to ensure quality, significantly stalling commercial transactions. This selection process became a social issue notably during the late 15th to the 16th-century Sengoku period, leading to frequent issuance of 'Eri-zeni Re'. For instance, coin selection bans were already seen during the Oei era (1394-1428), though they had limited effect. In the Eisho period (1504-1521), the Muromachi Shogunate issued stringent 'Eri-zeni Re', forbidding the use of any coins except Eiraku-sen, but the abundance of circulating bita-sen rendered these directives ineffective. The Tenmon era (1532-1555) saw further specific ordinances classifying coins into good and bad and attempting to set exchange rates. Amidst the chaos, money changers specializing in appraising and exchanging coin quality emerged. They established exchange rates between refined and bita coins, earning a living from transaction fees. By the late Muromachi period, it was common practice for the exchange rate to be 1 refined coin for 2, or even 3-4 bita coins, with official records listing such arrangements. Consequently, merchants faced complex calculations with each transaction, leading to unstable prices. Prices for rice and other goods fluctuated based on the volume and quality of circulating bita-sen, keeping the lives of common people fraught with uncertainty. For instance, though 1 kanmon (1,000 mon) represented the same nominal value, the purchasing power between 1 kanmon of refined coins and 1 kanmon of bita-sen varied greatly, leaving the market in a constant state of confusion. This situation became a major impediment to the economic development of medieval Japan.

The private minting issue that plagued Japan's economy throughout the medieval era finally saw resolution with the establishment of a unified government and an accompanying monetary system reform. In the late 16th century, Toyotomi Hideyoshi unified the nation and embarked on a currency system unification with his authority, prior to the emergence of Keicho Kobans. He minted exclusive coins like the Tensho Oban and Bunroku Tsuhō to attempt nationwide circulation, although his ambition ended halfway due to his brief reign. It was Tokugawa Ieyasu's establishment of the Edo Shogunate in the early 17th century that truly resolved the issue. Ieyasu recognized that a stable currency system was essential for national unification. In Keicho 6 (1601), he minted Keicho Gold and Silver, including the Keicho Koban, as the national standard currency, streamlining large-scale transactions' chaos. However, for the small change used by commoners daily, imported coins and bita-sen remained dominant, perpetuating the turmoil. To fundamentally solve this, the Edo Shogunate began minting the official 'Kan'ei Tsuho' in Sakamoto coin mint starting in Kan'ei 3 (1626), with full-scale mass production commencing in Kan'ei 13 (1636). The shogunate established mints across the nation to supply abundant, quality-consistent Kan'ei Tsuho. Notable examples were the Edo Shiba mint and the Kyoto Shichijo mint. Concurrently, the shogunate rigorously cracked down on private minting, imposing harsh penalties on violators. Gradually bita-sen were eliminated from the market, with Kan'ei Tsuho gaining nationwide prevalence. Public trust grew due to the consistent quality of Kan'ei Tsuho and the shogunate's strong backing. This consolidation of unified currency not only almost completely resolved the private minting issue that persisted since the medieval period but also played an extremely crucial role in establishing the stable economic foundation of the Edo era. The resolution of the private minting issue marks a groundbreaking turning point in Japan's currency history.