The challenge coin tradition goes back at least as far as the forerunners of the Air Force, depending on whose legend you listen to. The basic idea is that everyone in a military unit carries the unit's challenge coin as a way of demonstrating membership in the unit.
Challenge coins have also been minted as souvenirs for servicemen participating in major events (task forces, special operations, etc.). One such series of special events was the US Navy's support of the rescue and recovery operations for the Apollo missions. This set of commemorative coins was made available to crewmen of the USS Ticonderoga, the last carrier to recover a Command Module from a Moon landing mission.
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Those are great to see. I was given one when I got up and did PT with my son, all the other troops and the rest of the families on family PT day.
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