askchapo

What I'm imagining is one currency ("foreign currency", let's call it) is used mainly for other countries to buy goods from the 2-currency country; this one would be "cheap" relative to other countries in order to encourage trade. That currency would be similar to an export country's currency (like China).

So let's say our hypothetical country wants to trade lumber, they'll price the lumber according to the foreign currency for other countries to buy.

The other currency ("domestic currency") is earned and used by the citizens of said country to be able to purchase goods (domestic and imported). This currency would be "strong" and could allow citizens to sustain a quality of life that allows them to comfortably afford a home, education, groceries, etc.

So the hypothetical exchange rate of "domestic currency" (DC$) for the "foreign currency" (FC$) would look something like this:

1DC$ = 100FC$

Another condition: Domestic goods for domestic purchase are not priced according to the domestic currency, they're priced at the foreign currency and can be bought using the domestic currency (by citizens).

So going back to the lumber example: a citizen wants to buy lumber. That citizen will purchase lumbar using the domestic currency, but the price of the lumber will be set according to the foreign currency (which is it's price during trade).