Historical Sketch

The Emirate of Bukhara was established in 1785 when the Manghit dynasty took power and adopted the ruler's title emir instead of khan. The Russian conquest of Central Asia also reached Bukhara in 1873, which kept statehood under a protectorate. In September 1920, the Red Army conquered Bukhara and overthrew the monarchy. The People's Soviet Republic of Bukhara was proclaimed, in February 1924 renamed to Socialist Soviet Republic. In October of the same year, Bukhara and neighboring Khorezm joined the USSR, where its territory got partitioned between Uzbekistan and Turkmenistan.

Monetary History Overview

The economic system of the Turkestan region had traditionally been based on accounting in the silver Tenge coin, taken over from Persia in the 18th century, with occasional gold coinage and additional subsidiary coppers. The coinage had continuously deteriorated during the 19th century such that debasing had driven out most of the silver. After the establishment of the Russian protectorate, an attempt was made to withdraw the local coinage and to introduce Russian subsidiary coins. The Bukharan Tenge was initially rated as 20 Kopeks, later lowered to 15 Kopeks. In early 20th century, the Bukharan Emirate resumed the minting of silver coins. When the Russian revolution reached Central Asia the local currencies depreciated rapidly. The Bukharan Emirate first issued copper coins at higher denominations, then, as the devaluation went on, the government switched to issuing paper money in increasing denominations, produced via hand stamping rather than machine printing. The establishment of the People's Republic did not change the country's monetary situation. The new government, however, switched accounting to the 1st Bukharan Ruble (Som) in 1920, using the transision rate from the time when the Russian protectorate was established. The depreciation continued in full speed as money issuance was uncontrolled and unbacked. In late 1921, an agreement between Russia and the Bukharan and Khoreziam People's Soviet Republics equated the local Ruble currencies with the (more stable) Russian Ruble notes of 1917 (referred to as "Kerenki" since they were issued under the 1917 Provisional Government). In January 1922, Soviet Russia carried out a currency redenomination, where new "model 1922" paper money was issued and earlier state paper money of all types was globally revalued by cutting four zeros. Soviet Bukhara imitated the step and introduced the 2nd Bukharan Ruble (Som) against which the all types of earlier notes as well as the "Kerenki" got devalued. New machinery was introduced so that the new 1922 notes were of considerably better quality than the earlier notes. The new currency continued to depreciate, even more rapidly than in Soviet Russia, so that the initial parity to the Soviet Russian currency could not be preserved. Starting in the second half of 1922, Russian notes were traded at a premium over the Bukharan ones. In March 1923, the Soviet Union organized an Economic Conference for Central Asia which resolved to abolish the currencies of Bukhara and Khorezm and switch over to the Soviet Russian Ruble. The changeover took place during 1923, the Bukharan silver coins remained tolerated in Soviet Uzbekistan and Turkmenistan until end 1925.

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