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While the origins of the challenge coins are of much debate, most agree to the fact that it started during the First World War. Some say this tradition began in the United States Army Air Service. During this period they were many volunteers joining in the US Army. As the story goes one of the service lieutenant ordered small, solid bronze medallions (or coins) to be made. The coin was gold-plated with an engraving of the squadron's insignia and was very valuable. Those Challenge coins were presented to each of the pilots in the squadron. One of the pilots who never owned anything as valuable as this coin placed it in a small leather pouch which he hung around is neck.

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