History of Danish Krone

The currency system in Denmark came into existence in 1625 when rigsdaler was made the official currency of the country. It had 3 subunits to it namely mark, skilling and pfennig with a complex exchange among them i.e. 1 rigsdaler = 6 mark, 1 mark = 16 skilling, 1 skilling = 12 pfennig. This complex rate regime continued over a long period of time with some small corrections in the mean while. In 1873, Scandinavian Monetary Union was established constituting of two countries i.e. Sweden and Denmark.Krone


The purpose of this union was to revalue the currencies of the member countries to put them at par with each other and fixing them against gold. It was due to this monetary union that krone was introduced in Denmark and became the legal tender in the country. The currency got onto the gold standard with a fixed exchange rate of 2480 kroner = 1 kilogram of fine quality gold. During the First World War, the gold rate of all the currencies was abandoned and krone too, was affected by it. The Scandinavian Monetary Union was dissolved and krone was brought down but it was decided that the name of their now separate currencies wont be changed.

Denmark once again fixed its currency to the gold standard in 1924 but it had quit it permanently in 1931. Krone was pegged to the German reichsmark during the German occupation from the year 1940 to 1945 but after the Second World War was over it was pegged to the British pound and US dollar. When in 1999, the European common currency, euro was launched, most of the European countries opted in favor of the currency but Denmark moved out of the Maastricht treaty so that it could protect its own currency.DanishKrone

Denmark is using the krone as its currency and doesn’t use the euro, having negotiated the right to opt-out from participation under the Maastricht Treaty of 1992. The government held a referendum, in 2000, on introducing the euro. The results in percents look like this 46.8% voting yes and 53.2% voting no.

Denmark borders one eurozone member – Germany, and one european union member – Sweden, which is legally obliged to join the euro in the future.

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