What is the meaning of convertibility?

convertibility is an agreement between different currencies or currency systems setting a ratio for exchanges between their units. They can be formal agreements (such as when an airline decides to make its frequent-traveler "currency" convertible with a telecommunications company's long distance phone calls) or left to an open market (such as the exchange rates obtained in the global market for most national currencies). When regulations are introduced to make a currency not convertible into another, and if people have an interest in converting it, black markets are to be expected.