Doing this allowed the U.S. coin to be exchanged for a peso in a 1 to 1 exchange. Thus, it was natural to use the same symbol to denote the U.S. dollar as was used for the Spanish peso.
This PS theory is now widely accepted but there are various alternate explanations that have been proposed over the years for how this ubiquitous symbol came into existence.
One of the most popular came from libertarian philosopher and author Ayn Rand, who in her 1957 novel “Atlas Shrugged” included a chapter on the dollar sign, which she claimed was a symbol not only of American currency but of the nation's economic freedom.
According to Rand, the dollar sign (written with two downward slashes instead of one) came from the initials of the United States: A capital U superimposed over a capital S, minus the lower part of the U.
No documentary evidence exists to support this theory, however, and it seems clear the dollar sign was already in use by the time the United States was formed.
