The currency that vanished into a million pieces

Wealth & Business · Published 19 October 2026 · Updated 20 October 2026 Swipe more like this →

In short: Before the modern hryvnia, Ukraine navigated a turbulent monetary history defined by the karbovanets. From gold-backed notes in 1917 to the hyperinflationary millions of the 1990s, this currency's journey through revolution, occupation, and economic collapse reveals the fragile nature of value.

The karbovanets has appeared in four distinct periods of the 20 and 21st centuries. Its origins are rooted in the early 20th century, specifically during the Ukrainian People's Republic (1917–1918). At that time, the currency was theoretically stable, with one karbovanets containing 17.424 parts of pure gold and being divisible into 200 shahs or two hryvnias. However, the era was marked by rapid political shifts, including the rise of the Hetman Pavlo Skoropadskyi in 1918 and the subsequent formation of the Ukrainian Directorate. The name itself may stem from an ancient practice of carving calculations into rods or from incisions made on metal coins. Early issues in 1918 even featured the national trident emblem.

The currency's later iterations were defined by extreme volatility. During the Nazi occupation between 1942 and 1945, the German Reichskommissariat Ukraine issued 'Karbowanez' notes, pegging the rate at 10 karbovantsiv to 1 Reichsmark. In the post-Soviet era, the karbovanets (often called coupons) returned in 1990 to manage the collapse of the command economy. This period saw the denomination explode due to hyperinflation. By 1995, the National Bank of Ukraine was issuing 1,000,000 karbovantsiv notes featuring the Taras Shevchenko Monument. The 1990s era saw denominations climb to 5,000,000 karbovantsiv through commemorative silver coins. Even the 1991 notes featured the Sophia Cathedral design.

The era of the karbovanets finally ended in 1996. To stabilize the economy, the Ukrainian hryvnia was introduced, necessitating a massive conversion rate of 100,000 karbovantsiv to 1 hryvnia. For a brief window between 2 September and 16 September 1996, both currencies circulated simultaneously before the karbovanets was officially discontinued. The transition was so rapid that the 1996 currency shift lasted only two weeks. This followed a period where the 1994 notes reached 500,000 karbovantsiv.

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