10 Centesimi – Italy

In 1862, Italy was grappling with the profound monetary complexities of unification. The peninsula, newly unified under the Kingdom of Italy in 1861, inherited a patchwork of at least eight different currency systems from its predecessor states. These included the Piedmontese lira, the Tuscan fiorino, the Papal scudo, and the Neapolitan ducat, each with varying metallic compositions and exchange rates. This fragmentation severely hindered domestic trade, economic planning, and the very idea of a unified national market, creating an urgent administrative and symbolic need for a single, national currency.

The government, led by Prime Minister Urbano Rattazzi and Finance Minister Quintino Sella, took decisive action. On August 24, 1862, the Legge sul corso forzoso (Law on Inconvertible Paper Money) was passed. This pivotal legislation established the lira as the sole legal tender of the Kingdom, based on a bimetallic standard of gold and silver. Crucially, it also authorized the issuance of inconvertible paper money, meaning banknotes could not be directly exchanged for precious metal on demand. This move was a practical necessity to finance the state's substantial debts from the wars of unification and to fund ongoing development, but it immediately placed the new lira on a shaky, fiduciary foundation.

Consequently, the Italian economy in 1862 operated under a dual system: an official bimetallic lira and a growing circulation of paper money that was legally mandated but not backed by specie. While this successfully began the process of monetary unification, it also sowed the seeds for future instability, including inflation and a divergence between the face value of paper currency and its real metallic worth. Thus, the year represents a critical juncture—the birth of a national currency, but one born from financial necessity and immediately burdened with the challenges of managing a forced circulation.