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deliberately shortening the periods during which particular
coin issues were legal tender and by abrogating the concept
that the issuing authority retains a perpetual liability for
currency not handed in even after it has ceased to be legal
tender
i.e. there could be recourse to complete demonetisation.
So long as the present strength of the coin market lasts it
would be possible to reduce some of the existing liabilities
of dependencies by regular demonetisations with little risk of
provoking large scale exchanges or redemptions. However, any
steps to demonetise or even "de-legal tender" coins too soon
after their issue would result in damage to the territory's
reputation, especially if the coins' legal tender status had
been emphasised in the original marketing campaign. It would
therefore be sensible to begin a process of demonetisation with
the earliest issues.
(i) Guarantees by promotional companies to repurchase redeemed coins
If redeemability is to be maintained there is a case for
encouraging such guarantees, as they at least provide a limited
safeguard. At present companies would be willing to repurchase
at face value most of the coins offered to them, because if the
coins are still in good condition they currently attract a
premium in the secondary market. The critical moment would
come if the coin market should weaken.
(j) Tighter restrictions on the redemption of coins
This could be done by placing limits on the number of coins which
can be redeemed at any one time. Further restriction could be
imposed by establishing that coins for redemption must be
presented by the holder in person in the territory concerned.
(k) Stop the issue of specimen coins
All the redemptions experienced by the territories for which data
is available have been confined to specimen coins.
Apparently