Some sources state that tradition of coining can be traced to World War I, through the aspirations of a young American aviator. Others claim it began in World War II, when American forces deployed to the far reaches of the globe. Soldiers back to the Civil War left for battle with a coin from home in their pocket and kept it after the conflict as a lasting remembrance of their wartime experiences.

So while there is debate as to its origin, what we do know is that members of the U.S. military have a long-standing tradition of coining, which symbolizes unit identity and esprit de corps. With bonds forged in battle thousands of miles from home, these coins are minted for military units, by select officers, or for certain operations – each bearing their own revered symbols and mottos – capture in metal the essence of their affiliations and their pride. Coins are a vital part of military life and are revered by troops in every branch of service.

Today, coins are carried by soldiers, sailors, airmen, Marines, as well as lawmen and firefighters. These coins identify the bearer as a member of a particular unit that has a well-defined history and mission. Wherever current and prior service personnel gather, they challenge each other by “coining.” The group’s unique coin is displayed as a challenge to all in the group to display their own coins. There are several long standing rules, rewards and penalties that govern each challenge.

In November 2010, Veterans Resources at the University of Connecticut commissioned the minting of coins for distribution to new and returning student veterans. These unit coins are a gesture of thanks on behalf of the University of Connecticut to recognize their service, and to reinforce camaraderie among the University of Connecticut student veteran population.

Sources: http://custom.nwtmint.com/news_challengecoinhistory.php