Having been old school SF, I've had challenge coins since before they were even a civilian thing. From the U.S. Department of Defense:

One More Possibility

Spink also sent me an article called “Coining a Tradition” that was printed in a 1994 edition of Soldiers Magazine. It offered a similar version of the Vietnam story, the World War I tale and one other option, which dates back to the early 1960s

:“A member of the 11th Special Forces Group took old coins, had them overstamped with a different emblem, then presented them to unit members, according to Roxanne Merritt, curator of the John F. Kennedy Special Warfare Museum at Fort Bragg, N.C. A former commander of the 10th SFG picked up on the idea, becoming the first to mint a unit coin for the U.S. military unit. The 10th group remained the only Army unit with its own coin until the mid-1980s, Merritt said, when ‘an explosion took place and everybody started minting coins.’”

So if you’ve ever wondered how the challenge coin came about, you can take your pick of which story to believe!

(Wikipedia has a more extensive article)

I noticed something missing from the "SUGGESTED USES." I suppose it had to be politically correct. Another use was for the coin bearer to give his coin to a woman only if she became three-hole qualified. No exceptions, not even wives. Naturally, we carried extra coins.

I wonder if there's something comparable now for women carrying challenge coins? IIRC, Clod has been affiliated with Damn Interesting. Let's ask Clod if she has a challenge coin and what a woman might do with one, hmmm.