The Great Britain Pound (GBP) is the formal system of currency in the United Kingdom. To distinguish it from the unit of weight, GBP is officially referred to as the Sterling pound denoted by the use of the symbol £—‘L’ standing for ‘libra’ which is Latin for ‘pound.’ Along with the United States Dollar and the Euro, it is one of the world’s most extensively traded money.
In fact, the Pound sterling is the highest valued of the major currencies, with an average year-end worth of £0.64 against $1 USD in 2010. The origin of the reference ‘Sterling’ dates back to 1266 when a troy pound of high concentration of silver was the standard of exchange and commerce in England.
The history of British money is as interesting as the many names and colloquial terms that the Sterling pound has been known for through the years. Old coins prior to the introduction of metal coins in 1158 were actually made of pure silver. The Pound sterling was officially established by Queen Elizabeth I in 1560, while a re-denomination of the pound in 1971 meant 100 pence (each a ‘penny’) today is the equivalent of one pound instead of the 240-pence convention prior to decimalization of the pound system.
The quid is also known as the pound, and the symbol for the penny is ‘p.’ Individual coins are often pronounced ‘pee’ rather than ‘penny’ or ‘pence.’ British coins come in 1p, 2p, 5p, 10p, 20p, 50p, £1, and £2 denominations while British paper money in £5, £10, £20, and £50 notes. Scotland, in addition, even uses a £100 note. A glut of British slang like ‘folding stuff’ (referring to all British paper money) is commonly used to refer to different denominations of varying amounts.
Over the centuries the Sterling pound has maintained its dominance in both European and world markets bolstered by a highly-valuable fixed exchange rate. The United Kingdom also possesses the unique privilege in the European Union (along with Denmark) of opting out of the mandatory adoption of the Euro system of currency by EU member nations.
The idea of the British pound system being absorbed by a monetary union with other Eurozone member nations is a subject that is controversial. The UK is adamant in replacing their official currency which the British people consider it to be the symbol of their heritage, pride and security. Although the circulation of the Euro also meant the decrease in pound currency reserves in central banks and private institutions around the world, strong British financial and trade markets enabled the Sterling Euro to weather the recent worldwide recession and maintain their financial superiority.