American Gold Eagle vs. Gold Buffalo

American Gold Eagle vs. Gold Buffalo: Which Is the Best Option for Investors?

Investing in precious metals is one of the main ways Americans make sure their money won’t lose its value over time.

However, the most experienced investors search the country to get the best gold coins and bullion and add them to their collections.

Some of the most popular and valuable coins in America are the American Gold Eagle and Gold Buffalo coins, which are minted in this country and should be denominated in troy ounces.

Still, they have clear differences that make them more or less appealing to investors. On the one hand, the American Gold Eagle can be used as a legal tender in all 50 states, so it can be used as any other coin. It is also distributed by the US government and made from its gold reserves.

On the other hand, the Gold Buffalo coins are a bit more challenging to find, as investors usually have to go through private non-US coin collections to get their hands on one of them.

Nonetheless, it is illegal to use them outside of the United States. Still, many investors prefer it over the former one.

This article will go through all the aspects of these coins, and everything investors should know to decide which one to add to their collections. If you’re interested in this, please keep reading.

The American Gold Eagle Coin

The first coin we will review is the American Eagle, which appeared in 1986 and is made of 99.99% pure American gold. Furthermore, the US Mint produces it, and it comes in four main sizes that range from 1/10 oz to 1 oz. These American Eagle coins are commonly minted every year in a proof condition and a bullion version. However, there are two exceptions, in 1996, they were only minted in a proof condition, and in 2001 were minted as bullion exclusively. You can also find limited-edition coins depending on the year they were minted, which have a higher value among collectors.

History of the Gold American Eagle

These gold bullion coins were produced for the first time in 1986, becoming the first ever minted in America.

They used to be valued at $50,000 for each coin. Although now it is commonly known as the American Eagle, it used to be called the American Eagle to emphasize it was the first American gold coin.

It was also used to make clear that it couldn’t be used worldwide, unlike its Canadian counterpart, the Gold Maple Leafs.

Design of the Gold American Eagle

Another particular element of these coins is their design. You will find the bust of liberty on their obverse side. Frédéric Auguste Bartholdi designed this neoclassical statue, and it was meant to be part of a larger monument, but it ended up merely a bust.

The coin was meant to feature only the head, but the designers decided to add beams of light behind it for aesthetic reasons.

On the reverse side of the coin, you will find a gold American eagle with an olive branch hanging from its right foot and arrows in the opposite one.

Purity of Gold Eagles

The final characteristic we considered for this analysis is the Gold American Eagle purity. In the case of the American Gold Eagle, we found out it was made of .99999 fine American gold, which makes it 99.99% pure. This makes it a great coin for collectors and investors who wish to create Gold IRAs.

Moreover, we must remember that gold’s purity is measured in karats. Therefore, a 24-karat gold coin contains 24 parts per 24,000 parts of gold per troy ounce, making it 99.9% pure.

We also considered the fineness of the gold, and it happened to be 999.0, as each troy ounce features 1000 grains.

The Gold American Buffalo Coins

The Gold American Buffalo Coins

We are left with the second coin we will analyze today: the Gold Buffalo Coin. These American gold bullion coins were first produced in 1986 by the petition of Senator Robert Dole.

They were meant to commemorate the 50th anniversary of the US Mint Bill, which allowed the creation of other versions of the original American Eagle series.

In this case, the coins were made of gold alloy instead of pure gold. Moreover, their name comes from the popular American bison.

History of the American Buffalo

These coins first appeared in the market in 1986 and came in five sizes ranging from 1/10 oz to 1 kg. They are minted yearly with proof and bullion finish every year, but there have been two exceptions throughout history.

These exceptions occurred in 2001 and 2008, where you could also find these coins in a proof line due to the privy release program.

However, some believe the buffalo in these coins was called Black Diamond and lived in New York’s Central Park zoo.

Design of the American Buffalo Gold Bullion

The front of this coin has James Earle Fraser’s popular Indian Head design, which was the main inspiration for the original Buffalo nickel and will finally be used in an American gold coin.

Moreover, the reverse side of this Buffalo nickel has an American Bison, referring to its name. The bison stands proudly over a mountain of dirt and grass. Next to it, you will find olive branches and arrows, just like the previously described coin.

Purity of the American Buffalo Fine Gold

Finally, it is time to discuss the purity of the American Gold Buffalo coin. This is a fantastic coin for any investor, as its purity is .9999 fine gold per troy ounce, making it a great 24-karat coin and mil-spec bullion.

Compared to the American Gold Eagle coins, which are 99.9% pure, the Buffalo stands out as it is 99.99% pure. However, all investors must remember that Perth Mint measures their coins in oz Au instead of just Au per troy ounce.

Key Differences Between the Gold Coins

After going through the main characteristics of these gold coins, we will explain how they differ using the previously described elements.

History Comparison

Both popular gold coins appeared for the first time in the market in 1986, as they were minted almost simultaneously by the US Mint. Nonetheless, the Buffalo coins are available as bullion, and any collector can buy them whenever they want or need them.

Design Comparison

These two gold coins are similar in design, as both are fine gold coins. Still, each has different elements on both faces, and they only share the olive branch and arrows. In addition, they are minted by different mint houses, which deliver very different results because of the machines and means used during production.

Purity Comparison

They are also very similar regarding their purity. American Eagle coins are made of 99.9% pure gold per troy ounce, while the American Gold Buffalo coin is made of 24-karat gold per troy ounce, making it 99.99% pure. This is a slight difference, but most investors should consider it when purchasing them.

In addition, these two coins feature a .9999 fineness, but the American Eagle is slightly heavier than the Buffalo gold coin.

What You Need to Know as an Investor

Investors seeking pure Gold would do better with the Gold Buffalo since it has a greater purity than the Gold Eagle. If you want to stack gold as much as possible while also sticking with US-issued gold coins, then the Gold Eagle is the one for you.

The American Eagle is better if you want to invest in lesser amounts of gold or “crown gold” to avoid paying delivery costs because the Gold Buffalo isn’t available in lower numbers. Additionally, the Gold Buffalo is available in non-confiscatable quantities, which appeals to investors concerned that their assets could be taken from them due to political conditions.

The Gold Bullion Coin Act of 1985

The Gold Bullion Coin Act has both political and economic roots. Everything started because the South African Krugerrand and the Canadian Maple Leaf, two popular gold coins, had become increasingly popular in America, partly why the Act was passed.

According to the Los Angeles Times, more than $600 million worth of Krugerrands were promoted in the United States in 1984. Still, due to the increasing racial unrest in South Africa and an increasing international outrage against apartheid, the sales of the currency dropped in mid-to-late 1985. Moreover, it is crucial to understand that the sales of the South African Krugerrand made up half of South Africa’s foreign exchange revenues, and the United States was the currency’s most significant consumer.

President Reagan outlawed the purchase of the Krugerrand on October 11, 1985, punishing the white-run Pretoria government for its racist policies and officially depriving South Africa of its most profitable market for gold coins.

The Gold Bullion Coin Act of 1985 was passed to let the United States participate in the national gold coin market. This way, they could compete against the Canadian coin called “the Canadian Gold Maple Leaf Coin,” designed to fill the supply vacuum left by the Krugerrand prohibition.

Suggested Reading:  Krugerrand vs. Maple Leaf Coins.

Bottom Line

These two coins are fantastic for all sorts of crown gold investors, and the one you choose will depend on your priorities when investing in gold. Therefore, we highly recommend you find your preferences and select the gold coin that aligns better with them.

If you found this interesting, please check out the rest of our page for more gold-related reviews.

Arthur Karter

About 

Hi, I’m Arthur, and nobody wants to wake up in their 50s like me that they are in serious debt with minimal assets. This wake-up call forced me to reevaluate everything. After going through the school of Hard Knocks, I’m ready to help you by sharing the best retirement choices and how they differ from all the same-old, same-old options that financial advisors sell. These alternatives will help you build and protect your wealth.

Similar Posts