The coinage legislation of 1834 was passed during a contentious political battle between President Andrew Jackson and a contingent of elected officials and bureaucrats led by Nicholas Biddle and Senators John C. Calhoun, Henry Clay and Daniel Webster over the fate of the United States Bank.
While the president's opponents controlled the Senate, his supporters in the House of Representatives managed to push his agenda in the form of coinage legislation that sought to undermine the circulation of U.S. Banknotes in favor of gold currency.
The proposed bill was intended to devalue the overvalued silver (revalue the undervalued gold) from which the bank notes derived their monetary worth.
After the Coinage Act of 1834, silver (which was previously overvalued with respect to gold) became significantly undervalued and was exported to European markets where it was traded at a higher price.
Despite the attempts by Jackson, Taney and members of Congress to supplant paper currency in favor of “hard-money,” there were over a thousand banks issuing their own notes in small denominations (between $0.01 and $2.50).