Lead? China Cash Coin

It's not an official coin, Chinese or elsewhere. The legend appears to be that of a Qian Long cash coin, but the characters are somewhat crudely rendered - plus of course the very unofficial-looking hole, which has clearly been drilled into the coin after it was made.

Such an item probably wasn't made as part of a good luck charm - Chinese tradition places strong emphasis and meaning on the necessity for the square-hole-in-round-coin symbolism (the square hole is the earth and the round outside of the coin is heaven, or some such) and getting rid of the square hole would negate that - the Feng Shui replica coins you see for sale on the streets all have square holes in them, despite the difficulty this adds to their manufacture.

My assumption for your item would be funeral money - a replica coin, specifically made for tossing into a fire at funerals. Making it from metal rather than paper means you can go through the ashes of the fire afterwards and retrieve and re-use the coin. I'm not quite sure why you'd need to make a replica when the genuine Qian Long cash coins are so cheap and abundant, though.