Assignat

An assignat was a paper monetary instrument authorized in France by the Constituent Assembly during the French Revolution to avert imminent state bankruptcy. First instituted by decree in December 1789 and brought into circulation from April 1790, assignats remained in use until 1796. They were initially secured by the value of confiscated crown properties and Catholic Church estates, designated as biens nationaux, which were auctioned to retire the accumulated national debt.

Originally devised as certificates of indebtedness or bonds bearing five per cent interest, assignats were intended to be paid to state creditors, who could use them preferentially to purchase national lands. Once received as purchase money, the notes were meant to be cancelled and burnt. However, faced with an acute liquidity crisis and a severe shortage of metallic coin, the Assembly redefined the assignat as legal tender in April 1790, lowering its interest rate to three per cent.

By September 1790, the National Assembly abolished interest entirely, transforming the assignat into a standard, non-interest-bearing circulating fiat paper currency. To facilitate ordinary business transactions and stimulate daily commerce, the government produced notes in a broad spectrum of denominations, including values of 50, 60, 70, 80, 90, 100, 200, 300, 500, and 2,000 livres, with the smaller values manufactured in large quantities to support widespread circulation.