🔒Here’s why one prominent state lawmaker wants to make gold and silver legal tender in CT

State Sen. John Fonfara (D-Hartford) wants to make gold and silver legal tender in Connecticut.

At least 11 other states have done that, and during the recently ended legislative session, Fonfara — co-chair of the powerful Finance, Revenue and Bonding Committee — raised a bill to make it a reality in this state. The legislation — Senate Bill 1552 — was approved in the finance committee, but wasn’t raised for a vote in either the House or Senate before the session ended on June 4. Much to his surprise, though, two portions of Fonfara’s proposal were included in the bill to implement the state budget for fiscal years 2026 and 2027. A small section of that massive 693-page budget bill creates a new working group to monitor the precious metals markets and any legislation proposed in other states related to those metals. It also requires the Connecticut Precious Metals Working Group to annually report its findings and recommendations to the General Assembly. The budget bill, as of July 1, 2027, also expands a state sales tax exemption to all purchases of gold and silver bullion with a 90% purity level. Under current state law, only such purchases valued at $1,000 or more are exempt from the tax. Fonfara, who said he was initially not aware parts of his bill were folded into the budget implementer, adamantly believes Connecticut needs to allow precious metals to be used as legal tender, and will fight to make it happen in future sessions. He’s also a fan of so-called “Goldbacks,” state-branded certificates that have 24-karat gold layered into them in different values and can be used as currency with merchants willing to accept them. “I want to give the citizens of Connecticut the ability to own gold, to consider gold as an asset that is stable, unlike the dollar, and investable,” he said.

Gold beans

The original version of Fonfara’s bill intended to do a number of things toward that goal. In addition to recognizing gold and silver as legal tender, it sought to create:

• Initiatives to promote ownership of gold and silver and their use in transactions.
• A Connecticut Bullion Depository, and
• A Gold Start Savings Program for children living in “a concentrated poverty census tract.”

Fonfara said other states have proposed and/or approved similar legislation. Some — including Florida, North Carolina and Oklahoma — have also proposed developing their own depositories to provide residents a secure place to store their gold bullion. Other countries have also moved ahead of the U.S. when it comes to promoting the ownership and security of gold, Fonfara said. “In China, the government is encouraging citizens to buy gold ‘beans,’” he said. According to various news reports, gold beans have proven popular with Gen Z. The senator, though, is more interested in Goldbacks. “You’d be surprised how many states have created Goldback bond certificates,” he said. “They’re really beautiful.”

Local currencies

A privately held company in Utah, Goldback Inc., has developed and produced the certificates.

The company, which has about 20 employees, was founded in 2019 by Jeremy Cordon, who initially saw it as a cryptocurrency firm, but was “really interested in getting people to use gold as currency again.” Cordon said his idea for Goldbacks was based on “local currencies,” which are popular in Oregon, his home state. Often sold by chambers of commerce, local currencies sell at a reduced price and then are used to buy products or services at full price from local businesses. There are about 2,000 local currencies nationwide, he estimates. Goldbacks also are considered a “negotiable instrument,” which Cordon said falls under the Uniform Commercial Code, a law adopted by all 50 states to support interstate commerce. “It’s the same law that makes a Walmart gift card legal to use anywhere,” he said. Goldbacks are made with patented technology that atomizes 24-karat gold down to 1/2000th of an ounce. The gold is then layered between two polymer sheets. The currency, designed by Cordon’s wife Emily, is available in eight denominations, from 1/2 — which contains 1/2000th of a Troy ounce of 24-karat gold — to 100, which contains 1/10th of a Troy ounce. Their values are updated daily at 10 a.m. on the company’s website. On June 19, 1 Goldback was valued at $6.74. Cordon admits that, much like the federal government does with the penny, Goldback Inc. loses money producing its smaller denomination certificates. “I lose money on the halves and the ones, but I don’t lose money on the hundred,” he said. “And there are enough people buying hundreds and fifties to keep me in business.” In its first year in Utah, more than $500,000 worth of Utah-branded Goldbacks were produced. Since then, the company has developed branded certificates for five other states: Florida, Nevada, New Hampshire, South Dakota and Wyoming. It will soon add one for Oklahoma as well. State-branded Goldbacks are developed when enough merchants in a state participate, Cordon said. His company actively recruits businesses and has more than 2,000 nationwide. Just two Connecticut companies accept Goldbacks: Boss of Freedom Designs in Cromwell and HTE Industries in Enfield, which operates an online thrift shop. Neither business responded to a request for comment. Goldbacks can be bought through online distributors, or from local metals and coin dealers. Nationwide, there is $250 million worth of Goldbacks in circulation, Cordon said, adding that he’s not getting rich from his own gold mine. “I make less money than your dentist,” he quipped.

Friendly support

Fonfara’s precious metals bill was the subject of a public hearing in April, but only one person testified to support it — Erik Bartone, a partner in Cygnus Financial Group, a family-owned financial management firm in Glastonbury. Bartone also is owner and president of DBS Energy Inc., as well as a longtime friend of Fonfara’s and his former business partner in Wattifi, a third-party electricity supplier that shut down in 2023, during a dispute with state utility regulators. In his testimony, Bartone called the bill “a bold, forward-thinking effort” to provide residents with a way to “safeguard their savings, diversify their holdings, and protect themselves from the long-term effects of inflation and monetary instability.” Since the U.S. severed from the gold standard in 1971, he said, the value of the dollar as measured in gold has fallen more than 98%. In 1971, he noted, the median U.S. home cost about $25,000, while gold was $35 an ounce. “That meant it took 714 ounces of gold to purchase a home,” Bartone said. Today, with homes valued at about $400,000 and gold trading at $3,100 an ounce, “it now takes only 129 ounces of gold to buy a home,” an 80% decrease. “Gold has protected the ability to buy essential goods like housing. The dollar has not,” he said.

Not giving up

Following the public hearing in April, a substitute version of Fonfara’s bill was developed, seeking only to create the working group and extend the tax exemption to specific sales of precious metals — and setting the effective date for that as Jan. 1, 2026. However, that bill hit a financial snag. The legislature’s Office of Fiscal Analysis (OFA) said extending the exemption to all precious-metal purchases would cost the state $650,000 in revenue in fiscal 2026, and $1.3 million in fiscal 2027. Both Fonfara and Bartone say the OFA analysis was wrong, but the bill still was unanimously approved by the finance committee, and eventually moved to the Senate. The bill never came up for a vote, but somewhere along the way, two sections of the legislation were added to the budget bill, along with the change pushing the effective date for the tax exemption to July 1, 2027. Ultimately, the budget bill passed the House and Senate. For his part, Fonfara says he’ll try to get the fiscal note corrected or find the money to make up the difference, with the goal of making the tax exemption take effect next year.