1904 Panama 2½ Centesimos – Silver Coin, UNC

The 1904 Panama 2½ Centesimos is a cornerstone issue of the early Republic and one of the most technically remarkable minor silver coins struck in the United States. Minted in .900 fine silver at the Philadelphia Mint, this miniature yet historically powerful piece marks the beginning of Panama’s national coinage.

This specimen is graded UNC, displaying full sharp detail with only the slightest trace of friction, if any. Original luster remains visible across protected areas, and both obverse and reverse legends are crisp and well defined. Coins of this issue are notoriously difficult to locate in high grades due to their tiny 10 mm format and heavy early circulation.

Weighing 1.25 grams and struck in .900 silver, the 1904 Panama 2½ Centesimos is famously known as the smallest coin ever produced by the United States Mint — earning the nickname “Panamá pill.”

1904 Panama 2½ Centesimos – First Republic Issue

The 1904 Panama 2½ Centesimos belongs to the inaugural series of circulation coinage following Panama’s independence in 1903. Although dated 1904, the coin was officially issued on February 12, 1905. It was later demonetized on August 31, 1930.

Catalogued as KM#1, this denomination served an important monetary function in aligning Panama’s new Balboa system with existing Hispanic-American fractional standards. As the first listing in Panama’s modern coinage, it holds essential status in any structured collection.

Obverse Design

The obverse presents a left-facing bust of Vasco Núñez de Balboa. The surrounding inscriptions read:

REPUBLICA DE PANAMA
DIOS LEY LIBERTAD
BALBOA
1904

In UNC condition, the portrait retains complete facial definition, sharp beard detail, and strong armor texture. The beaded border remains intact, and the surfaces show attractive originality.

Reverse Design and Specifications

The reverse displays Panama’s national coat of arms beneath seven stars representing the seven provinces of the Republic at the time of issue. The inscriptions read:

DOS Y MEDIO CENTESIMOS DE BALBOA
PRO MUNDI BENEFICIO

Below the shield appears:
G. 1.25 LEY 0.900

Technical details:

• Metal: Silver (.900)

• Weight: 1.25 g

• Diameter: 10 mm

• Edge: Reeded

• Alignment: Coin alignment

• Mint: Philadelphia

• Reference: KM#1

Collectibility & Premium Appeal

The 1904 Panama 2½ Centesimos in UNC condition represents a premium-grade example of a historically pivotal issue. Because most specimens circulated heavily, sharply preserved coins are increasingly scarce in today’s market.

Its combination of extreme small size, first-year status, and U.S. Mint origin ensures continued collector demand. For advanced world coin specialists, this coin is both a key type and an iconic early Republic rarity.