coin cloth bags were what came along to replace the wooden kegs and such that were used to hold coins. This wasn"t something that happened in the recent past but somewhere in the mists of time of the nineteenth century.
coin cloth bags mode of storage and display shouldn"t be used for anything other than easily obtainable circulated coins which in themselves are not particularly unique.
In other words don"t put anything in here that would suffer a decreasing of its value if it was to be scuffed or abraded by the other coins sitting alongside it in the coin cloth bags.
As you might have guessed these coin cloth bags hold more than one coin in them and this can lead to your coins becoming scratched or worse still worn down. This is referred to in the coin world as bag marks.
An unfortunate side effect with most coin cloth bags is also a tendency for the dye of the cloth to react with the coin and leave a mark on the coin. This is known very commonly as bag toning and can be in the form of discoloration on the face of the coin.
So do use them if you like the idea of these coin cloth bags, but only for your inexpensive non-collectible coins. For everything else use the proper storage or display cases.