The 1818 $5 STATESOF variety is so-named because of the closeness of the two words STATES OF on the reverse, such that they appear to be one word. This was purely an error on the engraver's part -- he started the word STATES in an acceptable position but spaced the letters way too far apart (compare the distance of the A in STATES from the surrounding T's with the tight spacing of the A and M of AMERICA). On the so-called "Normal Dies" variety (BD-1), the engraver started the word STATES in the same position (above the P of PLURIBUS), but spaced the lettering closer so that STATES and OF are properly separated. On the 5D/50 variety (BD-3, now known as 5 I over D), the engraver started the word STATES much farther to the left and spaced the letters normally, but this left a huge gap between STATES and OF.
As Akers noted decades ago, the three varieties of 1818 are of roughly the same rarity; all are very scarce to rare. The STATESOF variety is the least scarce by a small margin. Numerous Mint State examples exist, led by the PCGS MS66 from the Pogue Collection (sold in 2016 for a record $211,500 for the variety).
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