The official currency of Iceland is called the krona or kronur in plural form. Its ISO 4217 code is ISK and its symbol is kr. It means “crown” and people sometimes refer to it as “Icelandic Crown.” Its subunit is called eyrir or aurar in plural form and 1 krona is subdivided into 100 aurar, but the subunit is no longer in use. In 1874, The Danish krone was introduced to the country. The separation of the Icelandic krona from the Danish krona followed after the Scandinavian Monetary Union’s dissolution.
Iceland’s first coins were the 10 and 25 eyrir pieces and were introduced in 1922. Denominations of 1 and 2 krona pieces followed in 1925 and 1, 2, 5 eyrir pieces the following year. In 1944, Iceland obtained independence from Denmark, followed by the alteration of the coins’ designs in 1946. 10 krona pieces were introduced in 1967, 50 aurar and 5 kronur in 1969, and 50 kronur in 1967.
5, 10, 50 krona notes were issued in 1885. In 1904, 100 kronur were introduced and 10, 25, 100, 500, 1000, 5000 krona notes were circulated by the central bank of Iceland in 1961.
When the currency was revalued in 1981, 1 new krona was then worth 100 old krona. Coins less than one krona were withdrawn from circulation when the Prime Minister signed the regulation in September 2002.
5, 10, 50 aurar, 1, 5 kronur were introduced in 1981. In 1984, 10 kronur were introduced, 50 krona pieces in 1987, and 100 krona pieces in 1995. In October 2003, 5, 10, 50 eyrir pieces were no longer accepted. The banknotes that are currently in circulation are the 500, 1000, and 5000 krona notes. 2000 kronur is also in circulation though very rare.
In the first half of 2006, the rate of the Icelandic krona was ranging between 50 and 80 ISK to 1 USD. By October 2008, the value of Icelandic krona fell against the US dollar to 110 – 115 ISK to 1 USD. It continued to decrease in value by November 2008 to 135 ISK to 1 USD. In September 2010, the rate is 180 ISK to 1 USD and the value remains so up to now.