Pieces of Eight were coins that could and were quite legitimately cut up into halfs, quarters or eighths due to the high value of the complete coin.
lifted from the web…
Defacing Coins of the Realm
We receive e-mails from people asking whether it is illegal to deface coins. We are never quite sure why they need to know, or what they are intending to do. We are quite sure that it is still be illegal to deface coins, particularly current ones.
If you need to check on the legality, you could try contacting H.M. Treasury, or asking your local reference library, some libraries have a law library collection, otherwise you could ask a solicitor which will obviously cost money. While we are not in a authoritative position to give you a definitive answer we believe that you should be alright. The authorities quite sensibly are unlikely to prosecute anyone who damages one or two coins, but would probably get upset if someone defaced or printed an advertising slogan on several million of them. Similarly if your advert encouraged millions of others to do the same, you might have a problem.
The lack of response from the Royal Mint probably can probably be taken to indicate their lack of concern, and if you did find yourself facing legal action later, it would certainly be a mitigating factor, if not a defence, to be able to show that you had taken the precaution of asking the mint. Taking this logic a little further, you can probably understand the difficulty for the mint in answering your question. Assuming it is illegal to deface a coin, and also assuming that the Royal Mint are not concerned about you defacing a single coin, they can hardly write to tell you they have no objection, as they would not be allowed to give you permission to break the law.
http://www.24carat.co.uk/defacingcoinsframe.html
Rudeboy and on and on’s posts seem to contradict each other.