Wadōkaichin — Empress Genmei's Monetary Revolution

In Keeun 5 (708), January, a report arrived at the court from the governor of Musashi Province. It was news that 'copper was discovered in Chichibu District.' For the court at that time, copper was an extremely important resource. The casting of Buddha statues, the temple bells, and the construction of the new capital—all required metal, yet domestic production was scarce, necessitating dependence on imports from China.

Empress Genmei responded immediately to the news. She changed the era name to 'Wadō (nigiakagane)' and declared the minting of official currency for national circulation as harnessing this heavenly gift. In Wadō 1 (708), May, the minting office was established, initiating full-scale coin minting.

While there were attempts at coinage in Japan before, such as 'Fuhonsen' (around 683), Wadōkaichin is the first coin issued by the state with the clear intention of nationwide circulation. Empress Genmei's vision was not merely the minting of coins. Alongside the establishment of a Ritsuryo state, it aimed to build a 'monetary economy state', funded by coins for tax collection, salary payments to officials, and city construction.

The capital relocation to Heijō-kyō (Wadō 3, 710) symbolized this. Expenses for moving from Fujiwara-kyō to the new capital, construction of the palace, and rewards for nobles and officials were managed with coins, enabling the court to visualize and manage its finances. Wadōkaichin was a key infrastructure element and was instrumental in supporting Empress Genmei's dream of completing the Ritsuryo state.

Modeled after Tang's 'Kaigen Tsuho' (issued in 621), it was the most trusted currency in the East Asian world at the time. For the Nara court actively incorporating Chinese culture through Tang missions, emulating this design philosophy was a natural choice. The fanghole round shape embodied the Eastern philosophy of 'heaven is round and earth is square', symbolizing national authority. Thus, Japan's first serious official currency stepped onto the historical stage. Refer to Overview of Hole Coins for more information.

Wadōkaichin existed in two forms: copper coins and silver coins, a fact overlooked by many people. Almost all Wadōkaichin seen in antique shops or auctions today are copper coins, with silver coins being extremely rare, with only a few dozen believed to be extant.

The oldest documented mention of silver coins is from an imperial edict in Wadō 1 (708). Silver coins were slightly larger and heavier than copper coins. Their value was several times that of copper coins, though exact conversion rates remain unspecified in historical documents, leading to various theories among researchers today.

Silver coins likely circulated for a very short period. Silver's limited production made it unsuitable for mass minting. Due to its high value, it was assumed silver coins were primarily used in ceremonial payments by the court and high-ranking nobles or in foreign trade, rather than in daily transactions by the populace. Indeed, documents housed in Shosoin contain references to silver coins, but they hardly appear in documents related to rural manorial estates.

Currently, confirmed silver coins are mainly held in museums and art galleries worldwide, rarely appearing in the general market. If a genuine item were auctioned, prices could soar from several million to tens of millions of yen. Understanding Basics of Old Coin Auctions is essential when facing such rare items.

For copper coins, values differ greatly depending on condition, minting location, and era. Initially minted coins have clearer characters, whereas later, mock minting (private imitation) increased, leading to quality variations. During the Nara and early Heian periods, local mints likely operated, using subtly different molds. Differences in character styles and casting quality are crucial appraisal points for numismatic researchers. Standards for Coin Grading will aid in understanding the foundations of such assessments.

The coexistence of silver and copper coins mirrored the hierarchical society of the time. Nobles and officials traded with silver, while commoners dealt with copper in daily transactions—this dual structure aligned with the rank order envisioned by the Ritsuryo system. Wadōkaichin was not just an economic tool but a historical artifact reflecting the social structure of the Nara period.

In Wadō 4 (711), the court issued an unprecedented law, the 'Chikusen Joi Order'. Its content was astonishing, granting official ranks to those who accumulated a certain amount of money, with specific figures like granting a junior eighth rank lower to those who saved over 100,000 mon.

From a modern perspective, this policy was an extremely clever 'quantitative easing strategy'. To promote circulation, the government offered direct incentives to citizens. However, records indicate that the response to the Chikusen Joi Order was not as high as might be expected. While there were those who desired ranks, obtaining Wadōkaichin itself was difficult for those in rural areas, making it a distant matter for the common people.

In the organized central region or around Kinai, certain circulation was observed, yet coin economies fell short of permeating to the far ends of the eastern and western provinces. Nevertheless, the historical significance of this policy was significant. By the state clearly indicating that 'one's social status could be raised by using money', perceptions of commercial activity began to change.

In the capital of the Nara period, Heijō-kyō, East and West markets (East Market and West Market) were established, where transactions using coins took place. Records in Shōsōin documents show cloth was valued at certain mon, oil at certain mon, confirming that price displays with coins were indeed functional. Agricultural products, silk fabrics, pottery, and ironware were traded with coins, marking an embryonic market economy qualitatively different from barter.

Yet, outside the market, 'yō and chō' (a taxation system paid in cloth or rice) remained the norm, making coin economy mainly a city-centered phenomenon. Wadōkaichin stood at the forefront of Japan's economy for about 50 years until Mannentsuho emerged in Tenpyō-hōji 2 (758). As the initiator of the Twelve Imperial Coins, the legacy of Wadōkaichin continues to influence monetary policies profoundly. By observing the Market Index, the current position of the old coin market can also be confirmed.

In Tenpyō-hōji 2 (758), with the issuance of the successor Mannentsuho, Wadōkaichin faced a formal retirement. However, the reality was different. Mannentsuho did not immediately become widespread, and in practice, the older Wadōkaichin continued to be used for a long time in private sectors. Even following Shinkōkaihō (765) and Ryūheieihō (796), none of the subsequent Twelve Imperial Coins carried the same social impact as Wadōkaichin did.

The Twelve Imperial Coins concluded with Kangen Daibō, issued in Tengyō 6 (943). After that, Japan's independent minting of official coins ceased. A 'coin gap period' lasting about 600 years from the late 10th century to the late 16th century ensued. This gap was filled by imported coins such as Song coins, Ming coins from China, and Korean mun from Korea. For a deeper understanding of this gap period, see Details of Imported Coins and Hole Coins.

With the advent of the Edo period, it wasn't until Kan’ei 13 (1636) that Kan'ei Tsūhō was formally issued, marking effectively no existence of Japan's own official currency. Thus, the concept of 'nation-sponsored circulating currency', pioneered by Wadōkaichin, took over 900 years to be revived.

In modern Japan, Wadōkaichin holds a strong appeal among coin collectors. Especially well-preserved copper coins may be traded for thousands to tens of thousands of yen. Silver coins, being close to nonexistent at auctions, are a 'phantom presence', seen only in museums. Authentication depends on factors such as the shape of characters, casting surface texture, weight, and diameter. Due to the presence of numerous mock mintings (privately coined imitations from later), it is vital to have evaluations conducted by trustworthy specialists well-versed in Standards for Coin Grading.

Counting from Wadō 1 (708), 2026 marks the 1318th year since Wadōkaichin was born. The small copper disc minted in the capital of Nara still passes through the hands of collectors, transmitting historical warmth. In discussions of Japan's economic history, the meaning of this 'first piece' never fades. As a time capsule connecting the past and present, that small copper disc with a hole continues to shine even today.