Challenge coins have not been around for that long, though legend dates them back to the introduction of air combat in World War I. While some experts on challenge coins have examples from the 1950s, they really made their first ascent in military culture in the 1980s with Special Forces troops. Since the wars in Afghanistan and Iraq, however, they have spilled over from the military to military-related governmental agencies, non-military government agencies, the corporate world, and even into general interest organizations.

Challenge coins are specially-made coins that are inscribed with the name of an organization, an event, a mission, or some other meaningful insignia. They are given to people in honor of accomplishments and are generally deeply cherished by those receiving them. To those with particular coins, they serve as a symbol of solidarity and a reminder of the people and the event or organization associated with the coin.

To soldiers returning home from war, whether their deployment has ended or whether they are injured or killed in combat, challenge coins are considered to be among their most important possessions, ranking with wedding rings and dog tags in importance. A soldier's friends know that if a fellow soldier is killed or injured and must be sent home, that they should make every effort to see that the soldier's coins make the trip home with them.

Military coins are not the only ones, however. Many governmental agencies such as the Department of Defense mint their own challenge coin, as do governmental agencies which are only obliquely or not at all associated with the military. For example, the United States Department of Agriculture mints coins that are typically given to police, firefighters, or other first responders who display dedication or heroism. A number of Congressional representatives and high-ranking governmental workers mint their own coins and may, for example, hand them out to troops returning home to their Congressional districts.

Custom challenge coins are also seen in the corporate world. While the circumstances surrounding the giving and receiving of coins in the corporate realm are different than the combat situations where the coins originated, they are generally used to signify superb dedication or significant accomplishments. Discovering the trend, service clubs and general interest organizations have adopted them as well, to honor those who have made certain achievements or who have stood out in some way.

The carrying of challenge coins has become a point of pride for those presented with them. A tradition of "challenging" someone with a coin has become a goodwill gesture all over the world, with the presentation of a coin upon being challenged seen as a sign of comradeship and a certain connection with other coin holders. Often, in "challenge" situations, the person with the most significant coin will be treated in some way, to a free beer, for example. In other variations, the challenged person who doesn't produce a coin has to buy a round.

The Army, Navy, Marines, Air Force, Coast Guard, Reserves, and National Guard all have challenge coins. Because they have come be regarded as prized possessions - all the more so for being worn and dirty from being carried around - these coins have quietly become a symbol of pride and remembrance for people in military, and increasingly in other groups.

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