When nations join together and form a trading block where they agree to trade freely between themselves, adopt common external barriers against non-member nations, allow for free movement of labor and capital, and adopt the same currency, central bank, and monetary policy
Pros of being part of a monetary union

Non-fluctuating exchange rate
Reduced costs of currency conversion
Improved business confidence and investment
Less prone to speculative attacks
Easier price comparison between member nations
Cons of being part of a monetary union
Loss of autonomy over monetary policy
No ability to alter exchange rate to boost trade performance
High cost of currency conversion
Lack of fiscal union can lead to destabilization of the entire trading block
If a country joins a monetary union
It loses control over its monetary policy
Without control over exchange rate
No ability to alter it to boost trade performance
Lack of fiscal union in a monetary union
Can lead to destabilization of the entire trading block if member countries are reckless with fiscal policy
