The function of most circulating coins today is as small change. There are exceptions. Canada has successfully circulated both $1 (Loonie) and $2 (Twoonie) coins. Great Britain has it’s formerly round (not so round anymore) pound. Circulating coins of Australia include $1 and $2 denominations.
Switzerland uses a 5-franc coin in circulation that is the equivalent of about $5.50, making this one of the highest value coins in use anywhere. Japan is part of this group as well. Japan has its ¥500 (yen), with a value equivalent to about $4.60 U.S.
On April 27 the Japanese Ministry of Finance announced a newly designed ¥500 coin will be released into circulation. The coin in some respects is overdue, primarily due to the coronavirus pandemic. The coin’s release date was originally scheduled for April. Updating automated ticket, vending, and automated teller machines took longer than was originally anticipated. The cost of refitting all this equipment has been estimated at about 490 billion yen or more than $4.5 billion U.S.
The new coins will be similar to those already in circulation, but with changes meant to keep the coin technology one step ahead of counterfeiters. The significant purchasing power of the ¥500 has made it a target of forgers ever since it was introduced in 1982 due to the needs of the vending machine industry. Problems appeared almost as soon as the coin replaced a bank note of the same value since South Korea was circulating a ₩500 or 500-won coin of the same metal content and diameter as was the new Japanese coin. The South Korean coin was valued at about one tenth of the value of its Japanese counterpart. For that reason, the South Korean coin was commonly used in Japanese vending machines.
By the end of the 1990s about 70 percent of the estimated 5.5 million vending machines in Japan had been reprogrammed to stop taking the ¥500. Police found 657,000 altered coins between January and October 1999.
The problem persisted until the Mint of Japan began issuing new nickel-brass composition ¥500 coins with anti-counterfeiting devices in 2000. Vending machines were reprogrammed to recognize the conductivity of the nickel-brass. Counterfeiters soon followed by using lower alloy nickel-brass tokens or foreign coins. By 2012 what the Japanese press called “extremely well crafted” fake ¥500 coins believed to have been made either in China or in South Korea were being used successfully in ATMs.
The new generation of ¥500 coins will replace those first introduced in 2000. The 26.5-millimeter diameter of the denomination has remained consistent since the denomination was introduced in 1982. The 1982 to 1999 coins are composed of copper-nickel, have a weight of 7.2 grams, and a lettered edge.
The 2000 to 2020 coins are composed of 72 percent copper, 20 percent zinc, and eight percent nickel. The coins have a weight of 7.0 grams and a slanting reeded edge.
The new 2021 coins are a ringed bimetal three-layer structure issue composed of 75 percent copper, 12.5 percent zinc and 12.5 percent nickel. The coins have a slightly different weight of 7.1 grams and a helically reeded edge on which Japan and 500 Yen will appear. The coin has been described as being bicolor clad since two different colors are visible. The center is composed of copper-nickel, while the ring is composed of nickel-brass.
The 2021 coin uses the same paulownia plant obverse design, however on the reverse a bamboo leaf under the denomination numeral 500 has been replaced with the regnal (Reiwa) date of the issue (Year 3). A latent image has been incorporated into the numeral with the word Japan visible in a vertical direction. As on the issue that was introduced in 2000 micro-printing will appear on this coin as a counterfeit prevention device.
The Ministry of Finance indicated the estimated five billion copper-nickel ¥500 coins outstanding will continue to be considered as legal tender but will no longer be accepted by vending machines. The Mint of Japan is expected to produce about 200 million of the new coins during fiscal 2021.