1 Teston – Portugal

In 1644, Portugal was in the midst of the Restoration War (1640-1668), fighting to secure its independence from the Spanish Habsburg crown. This prolonged and costly conflict placed an immense strain on the Portuguese economy and its monetary system. King John IV's government faced the dual challenge of financing a war for national survival while managing a currency that was deeply debased and unstable. The treasury was chronically empty, leading to desperate fiscal measures that directly impacted the coinage in circulation.

The currency situation was one of severe crisis and complexity. The most common circulating coin was the real, but its silver content had been drastically reduced over decades of Spanish rule and wartime exigency. The monarchy resorted to issuing vast quantities of low-quality billon coins (copper with a thin silver wash) and pure copper réis, which the public received with distrust. This led to severe inflation, as the intrinsic value of the coins fell far below their face value. Simultaneously, older, higher-quality Spanish and Portuguese silver coins from before the debasements, such as cruzados, were hoarded or used for international trade, vanishing from everyday use—a classic example of Gresham's Law, where "bad money drives out good."

Efforts to stabilize the situation were largely ineffective in 1644. The government attempted monetary reforms, including calling in old coins for reminting at lower weights and purities, but these actions often eroded confidence further. The economy increasingly relied on a chaotic mix of officially minted coins of questionable value, privately cut and clipped coinage, and foreign currency, particularly Spanish pieces of eight from the Americas, which remained trusted for substantial transactions. Thus, the monetary landscape was fragmented and inflationary, a direct reflection of the kingdom's precarious political and military struggle.