There are two national currencies in Cuba (I learned this the hard way): The CUC (Cuban Convertible) and the CUP (Cuban Peso), also known as MN (Moneda Nacional). Now pay attention.
The CUC is pegged to the dollar; that is, 1 CUC is equal to 1 USD. The CUP, however, divides into the CUC by 24. That is, 24 CUP make up 1 CUC. Are you with me so far?
Say something costs $15 CUP; you can hand the vendor 1 CUC, and get 9 CUP back as change. The CUC can be converted into Pesos; hence the name "Convertible." Still with me?
It gets tricky, because both use the dollar sign - $ - so you have to look to make sure the price lists either CUC or CUP (and/or MN) next to it. Otherwise you can be taken advantage of, as I was, when I went to a little hole-in-the-wall place in the touristy areas of Old Havana. I ordered a plate of rice and beans and beef, but was scratching my head when the price was listed as $30. It was my first day, and not sure what else to do, I handed $30 CUC to the cashier. Without a second look or a second thought, she took it and sent my order to the kitchen.
Needless to say, accustomed as I was to favorable exchange rates in Latin America, I was suddenly very worried about how the heck I was going to afford to eat in this country (for that matter, I worried how the heck anybody affords to eat in this country)! Moreover, U.S. credit cards and debit cards do not work in Cuba, so all I had was the cash I had on me--and the Havana currency exchange had already taken their standard 13% off the top, so I didn't have as much as I thought I would have to begin with. I was suddenly looking forward to a very belt-tightening few days.
I considered just eating once a day, but late that evening, my hunger-pains got the best of me, so I ventured out to a pizza take-out place I spied near my Airbnb (cause those exist now in Cuba, apparently). I was staying in a much poorer part of the city, so they were arguably all the more incentivized to just take my clearly-tourist money and I would've been none the wiser. But they didn't. They were good, honest people. I meekly offered my $15CUC to the cashier and he immediately rolled his eyed and, with a guffaw, asked if I spoke English. That's when he explained to me the difference between CUC and CUP/MN. I am deeply grateful to that man.
CUC is typically used for taxis, hotels, and fine sit-down restaurants; CUP is for local goods and services. The museums will charge, say, $8 of everyone, but it will be 8 CUC of foreigners, and 8 CUP of locals, in order to keep the museums affordable to Cuban nationals. The CUC was first introduced in 2003 in order to try and prevent the US dollar from infiltrating the local economy too deeply as it had after the collapse of the Soviet Union.
I just want to save you from making a $30 mistake like I made. Whatever you buy in Cuba, make sure you first ask if it's in CUC (typically pronounced "coo") or in CUP (typically referred to as either "peso cubano" or "MN"). Good luck, and have fun!
