When these currencies "collapse" - Explore the 10 least powerful currencies in the world in 2025

There are still many currencies around the world struggling to hold their ground. Hyperinflation reaching thousands of percent, political instability, lack of economic diversification, and international sanctions are all key factors driving these currencies to continuously depreciate. Today, we will discuss 10 currencies that are “fighting” against these issues and learn how each country’s situation differs.

Exchange Rate Table - Truly Shocking

Lebanese Pound (LBP) - A Pointless Crisis

The Lebanese Pound (or called the Lira) has been the official currency of Lebanon since 1939. However, over the past few years, it has become the most prominent “symbol of economic defeat.”

Lebanon has experienced a severe economic crisis since 2019, with inflation reaching triple digits. The banking system has almost collapsed due to reasons such as only a few dollars remaining, the government defaulting on debt in 2020, and most drastically, the black market dollar value dropping over 90% compared to the official rate.

Although the central bank has tried to peg the exchange rate to the US dollar, in reality, this currency acts as a “floating” currency. The Lebanese Pound has become a bitter lesson that political issues and debt crises can destroy a currency to such an extent.

Iranian Rial (IRR) - Victim of Global Sanctions

The Iranian Rial (IRR) has a deep history dating back to the 19th century. But its decline began in earnest after 1979.

The Islamic Revolution of 1979 changed everything in Iran, including its currency. Later, strict economic sanctions from the US and allies turned the country into an “economic island.” These sanctions have been in place for “several decades.”

The consequences are clear: Iran’s economy cannot escape dependence on oil. Long-standing geopolitical tensions, soaring inflation that erodes trust among Iranians, and mismanagement have caused the Rial to depreciate continuously over 40 years.

Interestingly, Iran still has to “deal” with OPEC regularly, which results in investors favoring USD over IRR.

Vietnamese Dong (VND) - Stability Amidst Depreciation

The Vietnamese Dong (VND) has a different story. Vietnam was divided into two parts in 1954 after the war, and the Dong became the sole currency of the entire country.

Although the Dong continues to weaken, this “weakening” is actually an “asset” for Vietnam. The Vietnamese economy relies heavily on exports. A weaker currency means cheaper goods, leading to a trade surplus.

The State Bank of Vietnam employs a “managed float” system, meaning it does not let the Dong fluctuate wildly, as that would risk tourism and economic stability. Therefore, the Vietnamese Dong maintains a “trustworthy stability” amid gradual depreciation.

Laotian Kip (LAK) - Geopolitical Economics

The Laotian Kip (LAK) was introduced in 1952 after Laos gained independence from France. Initially, it was pegged to the French Franc, but as the economy changed, the Kip became volatile.

Laos is a developing country in the region, with an economy primarily based on agriculture. Foreign investment is limited, and the country remains a “market” within the global system.

Post-COVID-19, the Kip faced high inflation, and due to ongoing political instability, it has been under significant pressure over the past few years.

Indonesian Rupiah (IDR) - A Major Currency Weakening

The Indonesian Rupiah (IDR) is the currency of one of Asia’s largest emerging economies. Indonesia has over 270 million people, yet the Rupiah remains on the list of “weak currencies.”

This is because Indonesia relies heavily on commodity exports (palm oil, oil, iron). Inflation remains a concern, and the central bank sometimes intervenes in the market to prevent sharp “distortions.”

The good news is that Indonesia has tourism, foreign investment, and economic growth, which help prevent the Rupiah from continuously “declining” like a collapsing nail.

Uzbek Sum (UZS) - Heritage of Tight Control

The Uzbek Sum (UZS) has been in use since 1994, after Uzbekistan declared independence from the Soviet Union.

The problem: Uzbekistan is a country with strict government control over its economy. Old-style currency controls persist. Foreign investment is limited, and the country still relies on agriculture. Inflation remains high.

Recently, the government has begun to loosen economic policies, but change is slow. Outmigration from Uzbekistan is minimal, keeping the currency among the “cheapest” in the list.

Guinean Franc (GNF) - Africa’s Challenge

The Guinean Franc (GNF) is the currency of Guinea, which declared independence from France in 1958 and adopted the Guinean Franc in 1959.

Guinea faces “problems”: weak infrastructure, political instability, corruption, and an economy heavily dependent on mining (especially bauxite, aluminum). Commodity prices have fallen, and the country has followed suit.

Foreign investment is minimal, making the GNF vulnerable to volatility. The country’s instability casts a shadow over the currency.

Paraguayan Guarani (PYG) - Fragile Agricultural Economy

The Paraguayan Guarani (PYG) is an old currency (since 1944), but its history is full of “crises,” from the Chaco War (1932-1935) to the debt crisis of the 1980s.

The PYG depends heavily on agricultural exports (soybeans, meat, textiles). Global commodity price volatility means PYG remains unstable. Trade deficits, high debt levels, and the country’s small size prevent the currency from having “market power.”

Ariary of Madagascar (MGA) - Strange Number System

The Ariary (MGA) aims to be Madagascar’s new currency, used since 2005 to replace the Malagasy Franc.

One oddity: 1 Ariary = 5 Iraimbilanja, not a standard decimal system (which may cause confusion).

Madagascar relies on tourism, agriculture, and resource exports. Risks from storms, political instability, and poverty keep MGA depreciating gradually.

Burundian Franc (BIF) - The Poorest Country

The Burundian Franc (BIF) is the currency of Burundi, ranked among the poorest countries in the world. It has been in use since 1964.

The situation is concerning: Burundi has low development levels, most of its economy is subsistence-based, with chronic trade deficits. The country depends on foreign aid, with high inflation, food insecurity, and social unrest.

All these factors make BIF the “cheapest” currency in reality.

Overview: Why Do Currencies “Collapse”?

Whether it’s the LBP of Lebanon or the BIF of Burundi, several factors:

Inflation - When prices soar, the currency’s value drops. Countries with low inflation have stronger currencies; high inflation leads to depreciation.

Political Instability - Unrest, chaos, sanctions cause investors to flee, causing currencies to plummet.

Economic Structure - Countries relying on just 1-2 commodities (beans, oil, iron) are vulnerable to volatility.

Current Account - Trade deficits mean a shortage of dollars, forcing reliance on domestic currency, which depreciates.

Monetary Policy - Low interest rates or endless money printing are “slow poisons” for currencies.

Understanding these issues is not just “knowledge,” but a preparation for global investors who must monitor events with “significant impacts.”