I am not sure why the $1 & then $20 in currency, maybe somebody more knowledgeable can explain but I have heard the theory of the chip denominations many times over the years.

I have (had) been an avid black Jack player since early days, played in different countries and different currencies, and was a very good card counter. Have asked that question to many casino managers and discussed it with friends who owned casinos in the DR. Mostly because I like numbers.

The principle behind the chip denomination is that the basic unit is "5", not $1 as one would think. If you take all the denominations used in most games, they are all multiples of 5, is easier to count and again you can think in multiple of the unit. That is why when you get to 5x5 you start to count with an apparent new unit, $25, and start the next count using that new unit, but in reality you are just changing the way to count without touching the theory of the 5 unit.......still with 25, you are just using the next easier unit of 5, the magical 25, the unit times the unit 5x5=25.

That is why you have the snappers, 2.5, again, is a multiple of five, is 0.5 of 5. Very useful for games like BJ where you can win 1.5 of the unit (2.5).

Also, you never see a table with a minimum play for anything that is not a multiple of 5. Minimum play "$5", $10, $25, $50, $100 or "$500" (Have never sat in a table with a minimum of $500", probably never will since I can barely count these days,lol)

The reason $1 is still there this day and age is mostly for psychological and economic purposes, for players to feel comfortable, and also in the last decades for collectors. They are good for tips, to put in your pockets as traders, and to make you feel comfortable. After all, how can you not have a $1?? The unit of the universe (actually I believe nowadays is is 0) but the $1 with inflation does not add anything. In the old days, when it was worth something and was useful, it was still a multiple of 5, it was another magic number, it was 1/5 of 5. As opposed to what one would think, that 5 is the multiple of 1.

In most countries inflation have augmented the currency and diminished purchasing power. So denominations are much higher, still.. they use multiples of "5". The DR peso is now 40 pesos to $1. So, a $1 or even a $5 would be worthless. So most of the new chips start at 25 pesos, then 50, then 100, then 500, then 1000, then 5000. As you can see still multiples of 5. Places like Italy, before the Euros had the lira at 1000-US$1. Still while using very large numbers they were always multiples of 5.

There are still places where certain chips have a different denomination because of specific games they play locally, but that is not the norm.
Hope if you were able to stay awake until this part, you followed the theory, I had a hard time following myself. If anybody knows of a different theory, please enter......... I still think our currency system is based on the 5 unit theory, just that the $20 dollar bill somehow got stuck in there. Still, the $20.00 bill is a unit of 5