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It is generally accepted that Ashwood got its name from deposits of volcanic ash and from an early pioneer named Whitfield T. Wood who settled in the area during the 1870s. It was in 1897 that gold and silver was discovered. Ashwood soon became a boomtown. But gold and silver mining did not last long as ore deposits began to disappear, as did the town soon thereafter. Few of the original buildings remain. Most were destroyed by fire after many of the people had moved and were not replaced.

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