What Currency Would an Independent Texas Use?

An independent Texas could keep using the United States dollar on its first day, and it would need no one's permission to do it. In its 2021 annual report on exchange arrangements, the International Monetary Fund listed 14 countries that use another country's currency as their only legal tender, among them Panama, Ecuador, El Salvador and Montenegro. In 2000 the Senate Banking Committee put the legal point in one line of a committee report: countries "are free to officially dollarize unilaterally."

That is where the Texas Nationalist Movement starts. Its published answer on currency says that "Currency continuity is the default, not a problem to be solved," and that which money an independent Texas uses in the long run is a decision for the government Texans elect.

The dollar first

The movement has held the first step steady for years. In TEXIT, his 2018 book, TNM President Daniel Miller wrote that "the most likely scenario is that Texas will adopt the U.S. dollar as its official currency in the immediate aftermath of a Texit vote to encourage stability while seeking a negotiated currency union with the United States." TNM's 2026 report Can Texas Make It? builds its numbers on the same assumption, that Texas "would keep using the dollar from day one."

The precedents are real. Panama made the dollar legal tender at par through a 1904 monetary convention with the United States, a year after it separated from Colombia. Ecuador adopted the dollar by law in 2000. Montenegro took up the German mark and then the euro without joining the euro area or asking Brussels. A Texas that keeps the dollar converts no balances and prints no new notes.

On independence, the constitutional limits on money would stop applying. Article I, Section 8 of the United States Constitution gives Congress the power "To coin Money, regulate the Value thereof," and Section 10 forbids any State to "coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts." Both clauses bind the States of the union. A Texas that has restored its independence would write its own monetary law.

Building blocks already in Austin

TNM's position is that Texas would not start from nothing if it later chose a currency of its own. The Texas Department of Banking already charters and supervises banks holding $349.6 billion in assets, according to its June 2026 testimony. The Texas Treasury Safekeeping Trust Company manages about $165 billion in public money. The movement's report adds that a Texas central bank would be paid for by seigniorage, the earnings a monetary authority makes from issuing money and holding assets, rather than by taxes.

The report also names the largest cost of a separate currency: foreign-exchange reserves on the order of 10 to 30 percent of economic output, several hundred billion dollars for Texas. In TNM's analysis that is an asset Texas would own and build over years, out of fiscal room it already has and its share of federal reserves in a separation settlement, and it is not needed at all while Texas uses the dollar.

Two European separations show how new states have handled a currency of their own. Ireland's Currency Act of 1927 created an Irish pound held at one-for-one parity with sterling and fully backed by sterling assets, a link the Central Bank of Ireland says "remained largely unquestioned for almost half a century." Czechoslovakia moved faster. The Czech Republic and Slovakia became separate countries on January 1, 1993, and on February 8 two currencies replaced the shared one, with Slovakia fixing stamps to the old banknotes until its own were printed.

Gold and silver

The Legislature created the Texas Bullion Depository in 2015. In 2025 it passed House Bill 1056, and since September 1, 2026, gold and silver specie meeting the law's marking rules have been legal tender in Texas. From May 1, 2027, the enrolled bill provides that the comptroller "may establish or authorize one or more electronic systems that enable a depositor or vendor to make and receive payments using a currency backed by gold and silver bullion" held in the depository. The law requires no one to accept the metal and leaves Federal Reserve notes untouched.

TNM's answer treats HB 1056 and the depository as tools already built, and stops short of deciding how a future Texas would use them. It says the movement's job "is to show that the building blocks are already here, not to pre-commit the future Republic's monetary policy."

Money already in the bank

A deposit in a Texas bank is already counted in dollars, so if the dollar stays in use no balance has to be converted. Federal deposit insurance today covers up to $250,000 per depositor at each insured bank, for each ownership category. TNM's position is that an independent Texas would run its own deposit insurance, funded by member banks, and that keeping covered deposits covered through the handoff is a first-order item for the separation agreement.

Ireland's money changed more than once after its peg. The Irish pound broke from sterling in 1979, and on January 1, 2002, euro notes and coins took its place. None of those changes needed London's approval.