Gold Buffalo Coin Review

Today we are reviewing the first 1 oz .9999 fine gold coin produced by the US Mint and currently the purest gold coin offered by the US Mint. The hunger for 24-karat bullion gold did not escape the attention of the US Mint following the success of the Canadian Maple Leaf Gold Coin. It took them some time to introduce the Gold Buffalo Coin in 2006, well after the success of the less pure 22-karat American Gold Eagle Coins.

Background of the Gold Buffalo Coin 

The coin inherits its name from the American Bison that are depicted on the reverse side of the coin. The coin’s striking similarities to the 1913 Buffalo Nickel on which the design is based, resulted in the name “Gold Buffalo” that stuck as a popular name for this American Gold bullion coin. 

The Gold Buffalo was officially approved for coinage under Section 201 of the Presidential $1 Coin Act in December 2005

The Act specifically states that: “The gold bullion coin struck under this subsection during the first year of issuance, shall bear the original design by James Earle Fraser which appear on the 5-cent coin commonly referred to as the ‘Buffalo nickel’ or the ‘1913 Type 1’”

The mintage of the coin was set at quantities below 300,000. The gold buffalo was an immediate success among the American public. It meant that the US citizens could buy and own 24-karat pure gold coins from their own Mint rather than turning to overseas supplies of the Chinese Panda or the Canadian Gold Maple Leaf.

The Gold Buffalo is produced at the West Point Mint facility in New York. Only the proof set bears the mint mark “W” of the West Point Mint. 

According to the Presidential Act, only newly mined gold from the United States are allowed to be used for the gold content of the coin. 

Suspending sales of the Gold Buffalo in 2008

At the beginning of  2008, the US Mint kept the price of Gold Buffalo Coins at high premiums above the gold spot price for the first part of the year. This resulted in low mintage following the low demand for these high priced coins. 

The Mint adjusted the price downwards late in 2008 which was suddenly marked with economic turmoil and financial uncertainty. Investors flocked to the safe haven of gold bullion. The demand far exceeded the supply resulting in gold stock outages at the US Mint, forcing the US government to temporarily suspend the sales of Gold Buffalo 1 oz bullion coins. 

Features of the Gold Buffalo

The Gold Buffalo Coin’s design was written in the law stated above. The design has remained unchanged since its inception. It is based on the original 1913, 5-cent design of James Earle Fraser. Fraser was clearly the right person for the job because of his love for, knowledge and history of the Native American people. Fraser’s most famous work is a sculpture of a Native American atop a horse entitled “End of Trail”

“End of Trail” Sculpture by James Earle Fraser: Image from the National Cowboy & Heritage Museum

Obverse of the Gold Buffalo Coin

The prominent head figure of a Native American man dominates the obverse side of the coin. The head figure appears noble with his elegant features facing to the right. It is believed that Fraser studied life models of three Indian Chiefs as inspiration to create this beautiful proud image. 

The word “LIBERTY” is placed appropriately along the upper right edge following the coin’s curve. 

The year minted is written at the bottom left with the initial “F” right underneath for Fraser. 

The coin’s obverse is a striking design revealing prominence of the cultural background and history of America.  

Reverse of the Gold Buffalo Coin

The reverse is marked by the unmistakable feature of a standing American Bison. This rural image referred to as a “Buffalo” fills the face of the coin. 

At the top curve the words “UNITED STATES OF AMERICA”. Directly below the American Motto 

E

Pluribus 

Unum

In the lower half below the bison’s head, the words “IN GOD WE TRUST”. Below his feet on the piece reserved to feature the ground, the face value of the coin “$50” 

Following the bottom curve “1 OZ. .9999 FINE GOLD”

Gold Buffalo Specifications

Knowledge of the specifications of a gold coin assists you to spot counterfeiting. This is your first line of defense against buying counterfeit products. The standard specification of the Gold Buffalo:

  • Gold content – 1 oz gold (Troy ounce)
  • Gold purity – 99.99% (24-karat) 
  • Weight – 31.108g
  • Diameter – 32.7mm
  • Thickness – 2.95 mm
  • Face value – $50 USD backed by the United States Government
  • Mint – United States West Point Mint in New York. Only the proof sets bear the mint mark “W”.

How many Gold Buffalos were issued each year?

The Gold Buffalo seized the attention of the public and was sought-after from day one. Low quantities of the 1 oz Gold Buffalo was minted. 

The graph below depicts the Gold Buffalo issued by the US Mint each year. 

Figures provided by the US Mint

The Gold Buffalos fractional range

For people on a low shoestring budget, I have some bad news regarding the smaller dimensions (fractions) of the Gold Buffalo. Initially only 1 oz Gold Buffalos were issued. However, in 2008 the US Mint struck the:

  • ½ ounce Gold Buffalo – Face-value of $25 
  • ¼ ounce Gold Buffalo – Face-value of $10
  • 1/10 ounce Gold Buffalo – Face-value of $5

These were sold individually.

In 2009 these fractions were also struck by the Mint but only sold as a Four-Coin set. 

That is it! Those were the only fractional sizes issued by the Mint. Naturally these are rare and difficult to find.  

The Gold Buffalo’s value

The Gold Buffalo Coin trades at values well over the face value of the coin. Within its first year of issue, it traded at $800 per coin. Proof sets have traded in the past at values above $2,000 per coin. 

The Gold Buffalo’s value is closely linked to the spot price of gold and fluctuated with the gold spot price. The coin’s gold weight of 1 troy ounce is the same as the weight of the live gold spot price quoted every day. The coin’s gold purity of .9999 is above the investment requirement of 99.5%. 

Buyers of the Gold Buffalo are likely to pay an added premium above the gold spot price for the manufacturing process involved in minting the coin, low mintage quantities and the high-grade gold purity guaranteed by the US Mint.  

Pros and Cons of the Gold Buffalo Coin

As with any product that you buy online, this gold bullion coin comes with its pros and cons. I will now list each of them below which is in my opinion important for consideration before purchasing this coin.

Pros of the Gold Buffalo Coin

  1. Purity
    This was America’s first .9999 fine gold coin that filled the much-needed gap for US citizens to buy their own pure gold coin.
  2. Low mintage = higher values
    The low mintage put this coin in a class of its own. If you can buy it at a low premium above the gold spot price you certainly made a good buy.
  3. Classic design
    The coin encapsulates the spirit of America that is ingrained in the history of this proud nation. It is reminiscent of the wild open country of the West. The coin is considered by many as one of the most beautiful coins struck by the US Mint. This means when buying a Gold Buffalo that you are entering an active market.
  4. Backed by the United States Government
    The coin is fully backed by the US government issued as legal tender with a face value of $50. These coins trade at much higher prices closer to the spot price of gold. 
  5. Gold content, design, and quality
    Gold content, design and production quality are 3 criteria that are essential for the success of a gold coin. The Gold Buffalo certainly competes with the leading bullion manufacturers in all 3 those departments. The US Mint takes precocious measures to ensure the uncompromising quality of their flagship 24-karat gold coin. 
  6. Timeless elegance
    For me, there is an added benefit to keep design unchanged over the years that speak of timeless elegance. 
  7. Retirement planning
    As an approved retirement vehicle it has definite benefits. 
  8. Gold investment
    The Gold Buffalo is an excellent way to invest in physical gold for investors who seek to diversify their wealth. 

Cons of the Gold Buffalo

  1. Future growth questionable
    The coin’s low mintage can put you in a precarious position of a high-value coin. The question is how much further room is there for growth? Not all investors want to be in Numismatic expert’s shoes and reliance on people’s opinions is dangerous. 
  2. Security
    I find the security features and measures lacking in comparison to the Canadian Maple Leaf and the Gold Britannia Coins. For people that buy from renowned dealers, this would not be a problem. 
  3.  Tight budget
    Only in 2008 and 2009 other dimensions of the Gold Buffalo were minted. These fractional Buffalos are actually scarce and trade at high values. You can only buy a Gold Buffalo with a gold content of 1 ounce, nothing less. For folks with a tight budget or someone who is new to the gold market, this may be an expensive investment. 
  4. Softness
    The Gold Buffalo coin is prone to scratches and dents if not carefully handled like all pure gold coins of 24-karat. 

Final thoughts

The United States government finally acknowledged the craving for its own high quality, extremely fine gold produced coin by legally issuing the Gold Buffalo Coin. 

I am perplexed by the low quantities being sold each year by the US Mint. I understand it is due to the Mint’s obligations towards other coins as well. The low mintage of the coin may contribute to higher values and prices in the bullion gold coin market. 

The US Mint takes great care with producing its 24-karat flagship coin. A buyer of the Gold Buffalo Coin can rest assured that you are obtaining a: 

  • quality product, 
  • with a guaranteed, 
  • extremely high gold purity content
  • which is sought after by investors and numismatics worldwide.

I would definitely consider buying a Gold Buffalo Coin if I find it at a low premium above the gold spot price from an authorised seller. 

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4 thoughts on “Gold Buffalo Coin Review”

  1. Another interesting and informative article. Quality and rarity certainly comes at a price but would appear a good investment for those that can afford it.

    Reply
    • That is spot on Jenny. I came to the same conclusion about the Gold Buffalo Coin. Thank you for reading and come back again for many more great posts.

      Reply
  2. Fascinating history and information on the gold buffalo coin. It’s brilliance and design make it a beautiful coin that would stand out in a collection, but it’s important that you note that it’s purity can make it more soft, so it’s wise to be careful to avoid marking it with any scratches or dents. 

    I still like gold as an investment choice, but it’s interesting to see the collector / investor perspective as well. Thanks so much for sharing!

    Reply
  3. A well written and very interesting article. Low quantities of gold being sold each year could also be due to its cost as not many persons can afford to buy gold generally. It is also my opinion  that it would be more profitable in the long run to buy gold from other countries where there is no questionable future growth  or  security issues to be considered .One wonders  whether future economic turmoil could  even affect the growth and security of the gold buffalo coin? I guess only time will tell. It is my opinion that investing in gold is a wise investment if you can afford to especially for your retirement.

    Reply

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