15 Countries Using Foreign Currencies as Legal Tender

There are currently no countries without their own currency, according to a recent count by the International Monetary Fund (IMF). However, there are several sovereign states that have chosen to use another country's currency as legal tender rather than maintaining a separate national currency. These countries include El Salvador, Ecuador, Panama, Timor-Leste, Marshall Islands, Federated States of Micronesia, Palau, Montenegro, Kosovo, and Liechtenstein.

El Salvador adopted the US dollar as its official currency in 2001, after years of economic difficulties. Ecuador also abandoned its sucre in 2000 and began using the US dollar as legal tender, following a major financial and economic crisis. Panama has one of the world's longest-standing dollar-based monetary systems, with the US dollar being widely accepted alongside the balboa.

For very small economies, maintaining an independent central bank can be expensive relative to the size of the economy. This is why some countries have chosen to use a stronger foreign currency, such as the US dollar or euro, rather than issuing their own national currency.