Canada’s Monetary History:  With the creation of the Dominion of Canada in 1867, the central government assumed responsibility for money and banking. Ottawa issued coins in denominations of 1, 5, 10, 25 and 50 cents. They were legal tender in the four provinces that signed the 1867 Confederation pact (Ontario, Quebec, New Brunswick and Nova Scotia) and later in all provinces that subsequently joined the Dominion. 
     Between 1868 and 1869 the Dominion government withdrew from circulation and exported several million U.S. silver coins, which were actually worth only 80 per cent of their face value. This ensured that Canadian coins were the only coinage in use in Canada. Waiting for the 1870 series of coins to arrive from England, the central government resorted to issuing 25-cent notes. The public dubbed these small notes "shinplasters" after similar U.S. notes that were reputedly used, during the American revolution, to line soldiers' boots. The initial issue was followed by two others, the last occurring in 1923.
     The Dominion government wanted to extend its monopoly to paper money, which was still issued only by banks. Under the Bank Act of 1871, Ottawa issued $1, $2, $50, $500 and $1,000 notes. The banks retained the right to issue any note of $4 and over.