In 1916, the United States reached agreement with Denmark to purchase the Danish Virgin Islands for $25 million. The three small Caribbean islands of St. Thomas, St. John, and St. Croix – i.e. today’s United States Virgin Islands – were for a good two hundred years a Danish colony. The colony prospered from c. 1750 to c. 1850, but it became unprofitable for Denmark in the second half of the 19th century, especially after it suffered several natural catastrophes. During the First World War, the islands were sold to the United States, which valued their strategic position for their naval defenses in the Caribbean.