Rio de Janeiro was not prepared to become the new capital of Portugal, or the host of the king and his extensive retinue. Expenses increased dramatically in the colony and economic problems soon followed.
The circulating crown-sized silver coin of the time was the Spanish colonial 8 reales, mostly bust-type (post 1771/2), from the mints in Mexico City, Lima, and Potosi. In an effort to use state power to defray its own costs (a tactic abused many times over by the Spanish years before this), King Joao VI ordered the revaluation of the coins.
Up to that point, Spanish 8 reales were equivalent to about 750 reis (the reis being a monetary unit of Portugal, with 320 reis = 1 pataca). The coins were collected and overstruck with the coat of arms of Portugal, and with a value of 960 reis (3 patacas). The coin was called, among other names, the Novo Crusado. The revaluation generated a 'profit' of 25% per overstrike.
*In December 1788 Charles III of Spain died and the throne was taken by Charles IV. However, Spanish colonial coins of 1789 can have one or the other named, depending on how early in the year it was minted. The bust remained Charles III for several years more.