Pieces of eight were silver coins minted by the Spanish Empire in the 15th century, the name coming from the fact that they were worth eight reales. They were also called Spanish dollars and eight-real coins. Pieces of eight were used by merchants and pirates of the era who proliferated the coin all over the world.
The wide usage of pieces of eight during eras of exploration and colonization resulted in a worldwide familiarity with the eight-real coin. The British Empire (and its colonies, including what is now the United States) underwent a shortage in currency in the 15th century and resolved to allow Spanish silver coins for trade and commerce. Silver was also minted or smelted on site in several locations in South America where the Spanish mined it, including the legendary Potosí mines in Bolivia. The Spanish Empire and its merchants spread the coin all over the globe for three centuries after its minting in the 1400s, resulting in coins located in the Americas, across Europe and even in Africa and Asia.
In the English colonies especially, pieces of eight were known as "Spanish dollars" due to the conversion rate under English trade rules. An ounce of silver was worth one dollar, and the piece of eight itself was one ounce of silver. Pieces of eight could be traded for a full dollar or split into halves or quarters.