The Texas dollar, informally named the “Texas redback”, was the paper money of the Republic of Texas. The Texas dollar was issued between January 1839 and September 1840 by Mirabeau B. Lamar to minimize national debt during his Presidency of the Republic of Texas. The name “redback” comes from the reddish color of the back of the bills. Inflation, due mainly to overprinting,devalued the notes substantially, making 15 redbacks equal to one United States dollar.This debt of over $10 million was an important factor for annexation into the United States.
End of Circulation
The redbacks were issued in the denominations of $5, $10, $20, $50, $100, and $500 bills. There were also “change notes” issued at the time of $1, $2, and $3 bills that had a blank back. All these notes were issued from Austin, Texas. A lot of the notes appear as orange-colored because of the quality of the ink. Several people have suggested that the “burnt orange” color of the University of Texas have come from this coloring, but it cannot be proven.
By 1842, the government of the Republic of Texas would not accept the bills for repayment for taxes. The currency regained some value before Texas was annexed by the United States. However, Texans used bank notes from other states and shinplasters instead of the Texas money.
Under the Compromise of 1850, Texas was given $10 million for all the land it had claimed outside its present state boundary. With this money, Texas paid off all its debts, including the redemption of all redbacks.
The redbacks and change notes were redeemed and cut-cancelled. The notes were cut-cancelled to keep them from going out the back door and coming back in the front door to be redeemed again. These notes are highly sought after by collectors. A few notes were never redeemed or cut-cancelled; those notes are valued more highly.
Two early Republic of Texas heroes are found on redbacks. Both had died prior to the issuance of the notes. Deaf Smith is found on the $5 redback, while the “Father of Texas,” Stephen F. Austinis found on the $50 note.
Note, not all redbacks are authentic. The original notes were hand-signed in brown ink while the reproductions all are in black ink.
A new series of currency, called exchequer bills, was issued in 1842. These were similar once again to treasury bills and little use was made of them by the general public.
The Republic of Texas had little in the way of silver and gold and never minted any coins.