Cheaper Coins than the Real: Understand Why Some Economies Collapse in the Exchange Rate

Receiving your salary and discovering that it’s worth less every day is the reality for billions of people around the world. While Brazil experienced a devaluation of 21.52% in 2024, becoming the worst currency among major economies, there are countries where the population faces something much more drastic: currencies that are not only cheaper than the real but have also lost much of their purchasing power in just a few months. In 2025, this instability deepened, turning certain currencies into symbols of structural economic crises and prompting entire populations to seek alternatives — from cryptocurrencies to dollars hidden under mattresses.

Why Do Some Currencies Become Cheaper Than the Real?

Currency devaluation is never accidental. It always results from a combination of factors that systematically erode investor, saver, and even local confidence. Understanding these mechanisms is essential not only for grasping international economic crises but also for recognizing the risks surrounding any investment in emerging markets.

Hyperinflation is perhaps the most visible and devastating factor. While Brazil worries about inflation around 5% per year, some countries see prices double every month. This situation not only erodes wages in real time — it destroys confidence in the currency as a store of value. No one wants to keep money in a currency that loses 50% of its value in weeks.

Chronic political instability adds to this picture. Coups, armed conflicts, frequent government changes: these signals tell markets there is no legal security for long-term investments. Without this security, international capital flees, foreign reserves diminish, and the local currency becomes virtually worthless for international transactions.

Economic sanctions imposed by global powers — especially the United States — act as a chokehold on access to the international financial system. Sanctioned countries cannot sell their products in major markets, cannot import what they need, and their currency consequently becomes useless for global transactions. This has had profound effects on nations like Iran and Venezuela.

Capital flight further accelerates this collapse. When even citizens — entrepreneurs, savers, workers — prefer to store dollars informally rather than trust their national currency, it’s a clear sign of economic collapse. This reflects not only poor economic conditions but also a loss of institutional confidence.

Factors That Make a Currency Cheaper Than the Real: Comparative Analysis

To truly understand the phenomenon of currencies cheaper than the real, it’s important to recognize that each economy presents a unique combination of these factors. Some face acute crises (sudden changes), while others experience chronic decline (ongoing deterioration over decades).

Brazil 2024 can serve as a comparison point: a medium-sized economy with controlled (but concerning) inflation, relatively strong institutions, yet under market pressures. The 21% devaluation was considered an economic catastrophe. Multiply that number by three, four, ten — and you begin to grasp the scale of crises affecting the top of this ranking.

Extremely Weak Currencies: The 2025 Ranking of the Cheapest Currencies Compared to the Real

Based on exchange rate data updated through September 2025 and recent international economic analyses, here are the 10 currencies that suffered the greatest devaluations and are now among the cheapest than the real on the international market.

1. Lebanese Pound (LBP) — The Record Devaluation

Historical rate: 1 million LBP ≈ R$ 61.00 (Sept/2025)

The Lebanese Pound is undeniably the currency that has lost the most value. Officially, the Lebanese Central Bank maintains a rate of 1,507.5 pounds per dollar, a figure that exists only on paper. In Beirut’s black market, where actual transactions happen, you need over 90,000 pounds to get 1 US dollar. The gap between official and real rates is so stark that banks impose strict withdrawal limits, and many businesses refuse the local currency altogether, accepting only dollars. Uber drivers in Beirut now demand payment in dollars, outright rejecting the Lebanese pound — a clear sign of monetary collapse.

2. Iranian Rial (IRR) — Sanctions and Economic Isolation

Historical rate: R$ 1 = 7,751.94 Iranian rials (Sept/2025)

US sanctions against Iran have rendered the rial nearly useless internationally. Holding R$ 100 makes you “a millionaire” in rials — an illusion masking a currency with no real value. The Iranian government tries to impose exchange controls to artificially sustain the rate, but daily transactions reveal multiple parallel rates, each reflecting the true collapse. Interestingly, this monetary crisis has accelerated cryptocurrency adoption among Iranians. Bitcoin and Ethereum have become more reliable stores of value than the national currency for many seeking to preserve their capital.

3. Vietnamese Dong (VND) — Historical Structural Weakness

Historical rate: About 25,000 VND per dollar (Sept/2025)

Vietnam presents a peculiar case: a rapidly growing economy, yet the dong remains historically weak due to specific monetary policies. Visually, it’s amusing: withdrawing 1 million dong from an ATM produces a mountain of banknotes worthy of a heist movie. For Brazilian tourists, this is financially advantageous — with just US$50, you can live like a high-class individual for days. But for Vietnamese locals, the weak currency makes imports extremely expensive, significantly reducing their international purchasing power.

4. Laotian Kip (LAK) — Small Economy in Trouble

Historical rate: around 21,000 LAK per dollar (Sept/2025)

Laos faces a tough combination: a small economy, heavy dependence on imports, and persistent inflation. The kip is so weak that at the border with Thailand, many merchants prefer transactions in Thai baht, effectively rejecting the Laotian currency. This shows how currencies cheaper than the real can even lose regional acceptance.

5. Indonesian Rupiah (IDR) — Enduring Weakness of a Major Economy

Historical rate: about 15,500 IDR per dollar (Sept/2025)

Indonesia, Southeast Asia’s largest economy, has never developed a truly strong currency. Since 1998, the rupiah has consistently been among the weakest currencies worldwide. For Brazilians, this offers a notable tourist advantage: Bali provides a surprisingly low cost of living. With R$200 per day, you can comfortably stay in a quality resort. But for Indonesians, the weak currency is a constant barrier to international competitiveness and economic development.

6. Uzbek Sum (UZS) — Heritage of a Closed Economy

Historical rate: around 12,800 UZS per dollar (Sept/2025)

Uzbekistan has implemented significant economic reforms in recent years, seeking modernization, but the sum still bears the weight of decades of isolated, centralized economy. Despite efforts to attract foreign investment, the currency remains weak, reflecting decades of limited integration into global markets.

7. Guinean Franc (GNF) — Resource Wealth, Institutional Poverty

Historical rate: about 8,600 GNF per dollar (Sept/2025)

Guinea is a classic paradox: rich in gold and bauxite, valuable minerals on the global market, yet its currency remains among the weakest. The reason is structural: chronic political instability and widespread corruption prevent resource wealth from translating into strong institutions and a solid currency.

8. Paraguayan Guarani (PYG) — The Weak Neighbor

Historical rate: about 7.42 PYG per real (Sept/2025)

Paraguay maintains a relatively stable economy compared to some neighbors, but the guarani is traditionally weak. For Brazilians, this means Ciudad del Este remains an exceptionally advantageous shopping destination, where Asian imports can be bought at very low prices.

9. Malagasy Ariary (MGA) — Structural Poverty Reflected in Currency

Historical rate: about 4,500 MGA per dollar (Sept/2025)

Madagascar, one of the poorest nations globally, has a currency that reflects this structural poverty. Imports are prohibitively expensive, and the population’s international purchasing power is virtually zero. Currencies cheaper than the real at this level often reflect not just economic weakness but a lack of international opportunities.

10. Burundian Franc (BIF) — Political Instability in Exchange Rate

Historical rate: about 550.06 BIF per real (Sept/2025)

Ending the ranking, the Burundian franc is so devalued that to make significant purchases, people need to carry large bags of banknotes. Chronic political instability directly impacts its collapse, turning the currency into nearly worthless paper in international transactions.

Travel Opportunities with Currencies Cheaper Than the Real

A frequently overlooked aspect is that currencies cheaper than the real, while disastrous for local populations, create extraordinary travel opportunities for Brazilian tourists. A country devastated economically for its citizens can offer incredibly affordable travel experiences for those arriving with reais, dollars, or euros.

Bali, with its world-famous beaches, becomes an accessible luxury destination. Bangkok offers fine cuisine at street-food prices comparable to Brazil. Beirut, for those able to travel safely, could offer minimal costs — though current political instability makes this unfeasible at the moment.

However, this dynamic is problematic: it represents a form of “poverty tourism,” where we take advantage of others’ economic misery for personal gain. Being aware of this is important when traveling.

Cryptocurrencies: The Solution When the Local Currency Disappears

The rise of Bitcoin and Ethereum in countries with extremely weak currencies is no coincidence. In 2025, an increasingly evident phenomenon is happening: populations in nations with severe monetary crises are migrating en masse to cryptocurrencies, seeking a store of value that doesn’t depend on governments that have lost credibility.

In Iran, for example, young people and entrepreneurs adopt cryptocurrencies not as speculative assets but as practical survival tools. Bitcoin offers what the national currency cannot: relative stability and the ability to transfer value without intermediaries punished by the government.

This trend signals a profound shift: fiat currencies can only maintain value if the population trusts the institutions backing them. When that trust vanishes completely, decentralized alternatives emerge.

Lessons for Brazilian Investors in a World of Currency Instability

The ranking of currencies cheaper than the real offers several practical lessons for those considering international investments or wealth protection.

First lesson: fragile economies pose enormous risks. Cheap currencies may seem like tempting speculative opportunities, but these countries face deep structural crises. Investing in such environments requires specific expertise and a high risk tolerance.

Second lesson: currency crises are always precursors to bigger problems. A currency doesn’t collapse randomly — it fails because institutions have failed, trust has evaporated, or political instability has become unmanageable. Recognizing these patterns in foreign economies helps identify warning signs in any market.

Third lesson: diversification is not optional. Holding 100% of assets in a local currency — especially in emerging economies — is extremely risky. Allocating part of your portfolio in dollars, euros, gold, or cryptocurrencies provides protection against unexpected devaluations.

Fourth lesson: trust is everything. Strong currencies exist where institutions are solid, governance is transparent, and the population trusts that the system will work tomorrow as it does today. Investing in economies with these qualities is investing in security.

The phenomenon of currencies cheaper than the real in 2025 is not merely an international financial curiosity. It reflects geopolitical imbalances, emerging climate crises, armed conflicts, and institutional failures that characterize our time. For today’s investor, understanding these dynamics is not optional — it’s essential to navigate an increasingly volatile and decentralized global economy.