When a currency disappears on a planned basis (like the Deutschmark) the government issues a recall of the currency in banks at a set exchange rate: e.g. for th

When a currency disappears on a planned basis (like the Deutschmark) the government issues a recall of the currency in banks at a set exchange rate: e.g. for the Deutschmark it was set by law at 1.95583 DM = 1 euro (source: https://en.wikipedia.org/wiki/Deutsche_Mark https://en.wikipedia.org/wiki/Deutsche_Mark) When a currency disappears entirely (like with Zimbabwe), there's a much more chaotic basis as it switches to separate sovereign currencies, which often have different inflation rates baked in. As this can be much more unexpected than a planned currency transition, the market often doesn't incorporate the expected changes in real interest rates, and often the exchange rate needs to keep floating for a while to account for ongoing inflation. More info on Zimbabwe's abandonment of their currency: https://en.wikipedia.org/wiki/Zimbabwean_dollar#Abandonment_and_demonetization https://en.wikipedia.org/wiki/Zimbabwean_dollar#Abandonment_...