What Was the Russian Empire’s Currency?
The ruble was the official currency of the Russian Empire, and it has a continuous history going back to the Novgorod Republic of the thirteenth century. For most of the imperial period it was a silver coin, with the kopek (1/100 of a ruble) as the working unit of small change. The system lasted in roughly this form from the reign of Peter the Great until the financial crisis of the First World War: roughly 200 years in which the ruble functioned as one of the principal currencies of Europe (see Crisp, Studies in the Russian Monetary System, 1970).
Origins and the early system
The first Russian ruble coins were minted under Tsar Alexei Mikhailovich in 1654, in the form of large silver yefimki restruck from captured European talers. Regular minting of silver rubles began under Peter the Great in 1704, with a coin of 28 grams of fine silver — close to the thaler of the period. The system that emerged under Peter also introduced the copper kopek as the basic small-change unit, and it endured as the basis of Russian currency for the next two centuries. By the end of the eighteenth century, the ruble was subdivided into 100 kopeks, with the poltina (half ruble) and the gold chervonets (3 rubles) for larger transactions.
The first Russian paper money, the assignatsii, was issued from 1769 under Catherine the Great. Catherine authorised the Assignation Bank to issue notes backed initially by silver coin, but the convertibility was soon suspended and the notes depreciated: by the time the assignats were withdrawn in 1843, their nominal value was about a third of their original silver equivalent. The assignats circulated alongside silver and copper coin throughout the late eighteenth and first half of the nineteenth century, and their collapse was a lasting warning to Russian finance ministers about the dangers of fiat money (Crisp, 1970).
The gold standard under Witte
The decisive reform came in 1897. Sergei Witte, the minister of finance from 1892 to 1903, used the long period of stable silver receipts from the treasury to push the ruble onto a de facto gold standard. The reform of 1897-1899 fixed the ruble at 0.7742 grams of pure gold, a rate that put the ruble roughly on a par with the German mark and the French franc. The reform was paired with the foundation of the State Bank’s gold reserve, which by 1913 stood at 1,695 million rubles — about 1.3 billion grams of gold.
The gold standard, in turn, was the financial backbone of the rapid industrialisation of the 1890s and 1900s. Foreign investors, who could now calculate exchange risk precisely, poured capital into Russian railways, factories, and mines. The ruble held its parity through the Russo-Japanese War and the 1905 Revolution, and it was only the strains of the First World War that broke the system (Gatrell, The Great War and the Russian Economy, 2005).
The main coins
The Russian Empire issued a wide range of coins, but the working currency in everyday use was the copper kopek and the silver poltina and ruble. The gold pieces were mostly used for large transactions and for foreign trade: the imperial of 10 rubles (1865-1897) and the chervonets of various denominations. Platinum 3-, 6-, and 12-ruble coins were issued between 1828 and 1845, the only platinum coins ever minted in imperial Russia; the metal proved difficult to refine and the series was discontinued. The imperial mints at St Petersburg, Moscow, and (after 1843) Warsaw produced the empire’s coinage, and Russian coins circulated widely in Central Asia, the Caucasus, and the Far East.
The First World War and the end of the system
The financial system broke under the strains of the First World War. The government suspended gold convertibility in July 1914, and the ruble depreciated rapidly. By the autumn of 1916 the exchange rate had fallen to about half its pre-war parity, and the printing presses that the State Bank had been running at full tilt to finance the war were producing a paper ruble worth a fraction of its pre-war value. The Provisional Government inherited the collapsing currency in February 1917, and the Soviet government that followed it effectively created a new currency with the 1922-1924 monetary reforms. The imperial ruble ceased to exist as a financial instrument, although the symbol lived on (Gatrell, 2005).