10 Bizarre Alternative Currencies That Actually Worked

Money works because people agree that it has value. Usually, governments and central banks make that agreement easier by printing notes, minting coins, and regulating the financial system. But when conventional money is unavailable, restricted, distrusted, or simply inconvenient, people have repeatedly found substitutes.

Prisoners have paid for haircuts with fish and ramen noodles. Prisoners of war built functioning economies around cigarettes and even created their own paper currency. Elsewhere, governments and communities have experimented with money designed to behave differently from ordinary cash. These currencies may sound bizarre, but for a time each did the job money is supposed to do: people accepted it because they knew someone else would, too.

Related: 10 Tantalizing Stories About Money

10 The Prison Mackerel Standard

When smoking disappeared from U.S. federal prisons in the mid-2000s, cigarettes lost one of their traditional roles as underground currency. Prisoners still needed something portable, reasonably consistent in value, and easily obtained from commissaries. The unlikely replacement was packaged mackerel.

Known simply as “macks,” the oily fish became a common form of payment for everything from haircuts. They pressed clothes to shoeshines, cell cleaning, gambling debts, stolen food, and homemade prison alcohol. A haircut might cost two macks, and successful poker players could finish a game with lockers full of fish.

Mackerel worked partly because commissary prices provided a rough reference point and because relatively few prisoners actually wanted to eat the stuff. That made the pouches useful as a store of value instead of immediately disappearing as snacks. The system was hardly perfectly stable—fish shortages and rising wholesale prices could change the value of a mack—but prisoners still treated it much like cash.

There was one major drawback. Mackerel money worked only behind bars. Prisoners nearing release could not exchange a locker full of fish for dollars, so they generally had to spend, barter, or give away their accumulated macks before leaving.

It may be one of the few economies where getting out of prison also means liquidating your seafood portfolio.^[1]

9 Prisoner-of-War Cigarettes

During World War II, British economist R.A. Radford witnessed firsthand how quickly money can emerge even when no one officially creates it. In German prisoner-of-war camps, Red Cross parcels provided inmates with food, toiletries, and cigarettes. At first, prisoners simply bartered one item for another. Before long, cigarettes became the standard by which almost everything else was priced.

Instead of offering cheese for jam or sugar for chocolate, prisoners might advertise “cheese for seven,” meaning seven cigarettes. Even nonsmokers accepted them because they knew another prisoner would take them later. Cigarettes became a unit of account, medium of exchange, and store of value—in other words, money.

Oddly, premium brands did not necessarily command a premium when used as currency. For trade purposes, a cigarette was generally a cigarette. Prisoners tended to smoke the better brands themselves and spend the inferior ones, a miniature example of the economic principle known as Gresham’s Law: bad money drives good money out of circulation.

Some prisoners even manipulated the currency. When pipe tobacco was issued, inmates could roll it into more homemade cigarettes than the official exchange rate implied. Thin, underfilled cigarettes began circulating, forcing traders to inspect their money before accepting it.

The POW economy even suffered inflation and deflation as cigarette supplies changed. Nobody had designed the system, but scarcity and human behavior created a surprisingly sophisticated monetary economy behind barbed wire.^[2]

8 Ramen Noodles in Prison

Cigarettes and mackerel aren’t the only foods to become prison money. By the 2010s, one of America’s cheapest grocery-store staples had developed its own underground economy: instant ramen noodles.

Sociologist Michael Gibson-Light spent a year interviewing nearly 60 prisoners and staff members at a large state prison. He found inmates increasingly using ramen packets—usually called “soups”—to buy food, clothing, hygiene products, and services such as laundry and bunk cleaning. Ramen also became literal gambling chips in card games and football pools.

Its rise was not simply the result of tobacco bans. Prisoners told Gibson-Light that declining food portions and quality had made calorie-dense ramen unusually desirable. Its low commissary price, long shelf life, portability, and usefulness as actual food made it especially convenient as money.

The size of a prisoner’s ramen stash could even signal wealth. One inmate explained that seeing someone with 20 soups in his locker meant that person was doing well financially. Others would pay envelopes, stamps, or services to obtain more packets.

That gives ramen a strange advantage over conventional cash. When the economy collapses, you can still add boiling water and eat your savings.^[3]

7 Theresienstadt Ghetto Scrip

Not every alternative currency develops voluntarily. In 1943, Nazi authorities introduced special paper money inside the Theresienstadt ghetto in occupied Czechoslovakia.

Theresienstadt occupied a particularly disturbing place within the Nazi concentration-camp system. Tens of thousands of Jews were imprisoned there, many dying from starvation and disease or later being deported to killing centers. At the same time, Nazi officials used the ghetto in propaganda intended to disguise the reality of their persecution.

A special ghetto bank began operating in May 1943, using currency created specifically for Theresienstadt. The notes depicted Moses holding the tablets of the Ten Commandments and came in several denominations. They helped create the appearance of an ordinary community with wages, shops, banking, and economic life.

But the money did not turn Theresienstadt into anything resembling a normal town. It operated within a coercive system whose residents had been stripped of property, freedom, and legal rights. Survivor testimony also documents a separate black market in which prisoners traded food, valuables, and ordinary currency outside the official system.

Theresienstadt’s money therefore “worked” in a very different sense from most currencies on this list. It circulated because the authorities imposed a closed economic system—and because the existence of a bank and printed notes helped support the false image they wanted outsiders to see.^[4]

6 POW “Bully Marks”

Cigarettes worked remarkably well as money in prisoner-of-war camps, but prisoners eventually went one step further and created actual paper currency.

Around D-Day in 1944, one camp’s Entertainments Committee opened a restaurant where prisoners could buy food and hot drinks while listening to music and variety performances. Meals were initially priced in cigarettes, but that created problems whenever cigarette supplies changed dramatically.

The camp’s restaurant and shop responded by issuing paper notes called Bully Marks, named after the tinned beef commonly called bully beef. The shop effectively acted as a bank, issuing the notes in exchange for food. Each Bully Mark was backed by food held within the camp economy, preventing the organizers from simply printing unlimited quantities.

Initially, one Bully Mark was worth one cigarette. Both circulated side by side, and prices could be quoted in either currency. For a short period, Radford observed that Bully Marks even appeared capable of replacing cigarettes altogether.

Then came the monetary crisis. Food parcels and cigarette supplies were cut, the camp was bombed, and the restaurant temporarily closed. Prisoners became increasingly reluctant to exchange scarce food for paper notes, and confidence in the Bully Mark declined.

The experiment did not last, but while conditions remained favorable, it worked. Prisoners had independently created a bank, commodity-backed paper money, an exchange rate, and eventually something resembling a currency crisis—all within a POW camp.^[5]

5 Tea Brick Money

For centuries, tea was more than a drink in parts of Asia. Compressed bricks of tea became valuable trade goods carried from China into places such as Mongolia, Tibet, and Siberia. Eventually, some communities began treating the bricks as something else entirely: money.

Tea worked surprisingly well as currency. It was useful, widely desired, reasonably durable, and relatively easy to transport. Standardized bricks also provided recognizable units of value. Some were molded with markings identifying their quality or origin, while others were scored into smaller sections.

That last feature made tea unusually practical as commodity money. If someone needed to make a smaller purchase, they could literally break off part of their cash. The British Museum holds surviving examples whose backs were deliberately divided into equal sections so pieces could be snapped away for smaller transactions.

Unlike most paper money, tea bricks also had intrinsic value. If economic confidence collapsed completely, the owner could still withdraw the savings from the account. Few currencies have offered quite such an effective emergency withdrawal plan.^[6]

4 Ithaca HOURS

In 1991, residents of Ithaca, New York, began spending money that looked nothing like U.S. dollars. Called Ithaca HOURS, the locally printed notes were designed to encourage residents to spend more of their money with nearby workers and businesses instead of watching it immediately leave the region.

Founder Paul Glover initially set one HOUR at a value of $10, roughly representing an hour of basic labor in the area at the time. Smaller denominations soon followed, making the notes usable for ordinary transactions. Local restaurants, theaters, farmers, tradespeople, health practitioners, repair shops, and other businesses began accepting them.

The system grew far beyond a few neighbors swapping favors. Glover reported that thousands of residents and hundreds of businesses eventually participated, conducting millions of dollars’ worth of trade in HOURS. The currency was even used for loans and donations to local nonprofit groups.

Contrary to claims that Ithaca HOURS operated in some legal gray market, there was nothing inherently illegal about the scheme. Participation was voluntary, the notes did not imitate U.S. dollars, and professional income earned in HOURS remained taxable.

Ithaca had essentially created money whose usefulness depended on geography. A dollar could leave town with the next purchase. An HOUR was far more likely to end up in somebody else’s pocket down the street.^[7]

3 The Chiemgauer

What began as a classroom exercise became one of the world’s best-known regional currencies. In 2003, economics teacher Christian Gelleri and his students in Bavaria, Germany, created the Chiemgauer as a practical lesson in how money works. Local residents and businesses decided to keep using it long after class ended.

One Chiemgauer was pegged to one euro and could be spent at participating businesses throughout the region. The goal was simple: keep purchasing power circulating locally rather than immediately flowing to large national or international companies.

But the Chiemgauer came with a bizarre feature deliberately designed to discourage saving it. Traditionally, paper notes expired after a set period unless the holder bought a stamp worth a percentage of the note’s value to renew it. That meant anyone who left Chiemgauer sitting in a drawer too long effectively paid for the privilege. The obvious solution was to spend it.

The system also directed money toward community groups. Users selected local charities or nonprofit organizations to support, while participating businesses paid a conversion fee when converting Chiemgauer back into euros, part of which was donated to those organizations.

A high-school money experiment had turned into a functioning regional economy. Most currencies reward people for saving them. The Chiemgauer was designed to nag people into going shopping.^[8]

2 Tide Detergent

Some currencies are printed by central banks. Others apparently come in bright orange plastic bottles.

Around 2012, police departments and retailers across the United States began reporting an unusual wave of thefts targeting Tide laundry detergent. Thieves were not necessarily desperate to do laundry. The product was easy to recognize, difficult to trace, relatively expensive, and nearly always had a ready buyer.

Those qualities made stolen Tide surprisingly useful on the black market. Bottles that retailed for around $10–$20 could be resold quickly for cash at a discount. Law enforcement officials also reported cases in which Tide was exchanged directly in drug transactions.

The phenomenon became serious enough that some retailers locked up detergent or added additional security measures. In one Maryland investigation, police arrested 18 people after an organized group repeatedly targeted stores. Authorities investigating another operation reportedly found more Tide than cocaine.

Laundry detergent never replaced dollars on city streets, of course, but within particular illicit markets it developed several characteristics of money: it had a widely understood resale value, was portable, difficult to trace, and could be exchanged for other goods.

Few criminals probably dreamed of getting rich one bottle at a time, but for a while, clean clothes came surprisingly close to dirty money.^[9]

1 The Wörgl Experiment

During the Great Depression, the Austrian town of Wörgl faced severe unemployment, unpaid taxes, and an empty municipal treasury. Mayor Michael Unterguggenberger responded in 1932 with an extraordinary idea: if the town did not have enough ordinary money moving through its economy, it would create something that behaved differently.

The municipality issued work certificates in denominations corresponding to Austrian schillings and used them to pay workers on public projects. Local merchants agreed to accept the notes at face value, and the town itself accepted them for taxes.

The twist was that the money became slightly less useful if someone tried to hoard it. To keep a certificate valid, its owner had to attach a stamp each month costing 1 percent of its face value. Nobody wanted to be the person holding the note when the stamp came due, so people had a strong incentive to spend it quickly.

The certificates circulated through shops, workers, and the municipal tax office, helping finance roadwork, bridges, and other local projects. The experiment attracted national and international attention, and other Austrian municipalities began considering similar systems.

That attention ultimately killed it. The Austrian National Bank argued that only it had the legal authority to issue banknotes. Government authorities ordered Wörgl to stop, and the town appealed. On November 18, 1933, Austria’s Administrative Court upheld the prohibition, ruling that the certificates functioned as money and therefore violated the National Bank’s monopoly.

Wörgl had not secretly created black-market cash. It had openly built a functioning parallel currency—and proved it worked well enough to make the country’s central bank nervous.^[10]