Greek Drachma

The Greek drachma is the former basic unit of currency in Greece. The Greek drachma was an ancient currency unit used in many Greek city states. The drachma was reintroduced in 1832 following the establishment of the modern state of Greece; it replaced the phoenix, the first currency of the modern Greek state that was introduced in 1828.

After Greece was liberated from Germany in 1944, old drachmae were exchanged for new ones at a rate of 50 trillion to one, issued as one, five, 10 and 20 drachmae banknotes. In 1953, Greece joined the Bretton Woods system in an attempt to slow inflation. The following year, the drachma was revalued at a rate of 1000 to one, pegged at 30 drachmae to one U.S. dollar.

The three modern Greek drachmae were replaced by the euro in 2001 at the rate of 340.750 drachmae to one euro. This exchange rate was fixed on June 19, 2000, and the euro was introduced shortly thereafter in January of 2002. Following the Greek debt crisis that erupted in 2009, there have been arguments for and against Greece eliminating the euro and re-introducing the drachma as its national currency.

The National Bank of Greece issued drachma bank notes from 1841 to 2001, when Greece joined the Euro. Early denominations ranged from 10 to 500 drachmae. Smaller denominations (1, 2, 3 and 5 drachmae) were issued from 1885, with the first 5-drachma notes originally being made by cutting 10-drachma notes in half.

When Greece won its independence from the Ottoman Empire in 1828, the phoenix was introduced as the monetary unit; however, its use was brief, and in 1832, the drachma replaced the phoenix. It was adorned with the image of King Otto of Greece, who reigned as modern Greece’s first king from 1832 to 1862. The drachma was divided into 100 lepta. In 2002, the drachma ceased to be legal tender after the euro, the monetary unit of the European Union, became Greece’s sole currency.

Between 1917 and 1920, the Greek government issued drachma paper money in denominations of 10 lepta, 50 lepta, 1 drachma, 2 drachmae, and 5 drachmae. The National Bank of Greece introduced 1000-drachma notes in 1901, and the Bank of Greece introduced 5000-drachma notes in 1928. The Greek government again issued notes between 1940 and 1944, in denominations ranging from 50 lepta to 20 drachmae.