Tiny Coins, Big Questions: Even the Cent Is Losing Value

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Some people pay dearly for things that aren't worth half a cent in reality. Maybe that's why they're getting rid of cents in the U.S.

The cent is "getting away" or becoming less relevant in the United States. Here's how:

The U.S. penny will be phased out, with the Treasury Department halting production in early 2026 due to high costs and low usage. Each penny costs 3.7 cents to produce, causing annual losses over $56 million for the U.S. Mint.

Bipartisan lawmakers support the decision, and President Donald Trump ordered the Treasury to stop minting pennies in February 2025, calling it "wasteful."

Cash transactions will round to the nearest five cents, while electronic payments remain precise. This aligns the U.S. with Canada, Australia, and New Zealand, which discontinued low-value coins. Major banks, including JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo, are developing a "digital dollar" stablecoin to create a secure digital payment system, reducing reliance on coins.

1. Decreasing Purchasing Power

• Due to inflation, a single cent has almost no purchasing power today.

• People often ignore pennies — they’re seen as more nuisance than currency.

2. Retail Trends: Rounding & Digital Payments

• With widespread use of cards and apps like Apple Pay or Venmo, cents are rarely used.

• Some stores round prices to the nearest 5 or 10 cents — a trend boosted during the 2020 coin shortage.

• Other countries like Canada and Australia already eliminated their smallest coins.

3. High Cost of Production

• It costs more than 3.7 cents to make just one penny.

• The U.S. Mint loses over $56 million annually on penny production.

• This inefficiency has led to bipartisan political support for phasing it out.

4. Symbolic vs. Practical

• Pennies still exist in accounting ($1.99) but serve mostly psychological rather than functional purposes.

• Many machines (vending, parking meters) no longer accept them.

📉 In Summary:

Yes — the cent is getting away:

• It’s losing relevance in daily life.

• It’s economically inefficient.

• It’s out of step with digital finance.

🇺🇸 What’s Changing in the U.S.?

The U.S. Treasury will stop minting pennies in early 2026, following President Donald Trump’s executive order in February 2025, calling the coin “wasteful.”

• Cash payments will round to the nearest five cents.

• Digital payments remain exact.

• This brings the U.S. in line with Canada, Australia, and New Zealand.

• Major banks (JPMorgan Chase, Citigroup, Bank of America, Wells Fargo) are developing a digital dollar stablecoin to replace outdated physical systems.

📰 Sources

Some recent articles discussing the U.S. Treasury's decision to phase out the penny:

• CBS News: Treasury Department set to phase out the penny

• PBS NewsHour: U.S. Mint moves ahead with plans to kill the penny

• AP News: Stop making cents: US Mint moves forward with plans to kill the penny

• Reuters: US Treasury unveils plan to end production of penny coin

• NPR: No more pennies: In big change, Treasury will stop minting them

These articles provide detailed information on the reasons behind the decision, including production costs and the declining use of physical currency.