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Legend has it that the challenge coin originated in the U.S. Army in World War I. A wealthy lieutenant had coins struck for the men in his unit. When an Air Service pilot was shot down behind enemy lines, he escaped, but had no identification. Captured by the French, he was able to produce the coin his friend had given him. That showed he was an ally, and preventing the French from executing him as an enemy spy. This story has never been proved, but it makes for a great legend. What IS real is that challenge coins make a great way to show membership in a group and build team camaraderie.