Where it comes from?
Pound sterling, the basic monetary unit of Great Britain, divided (since 1971) decimally into 100 new pence. The term is derived from the fact that, about 775, silver coins known as “sterlings” were issued in the Saxon kingdoms, 240 of them being minted from a pound of silver, the weight of which was probably about equal to the later troy pound.
The British pound has its origins in continental Europe under the Roman era. The pound was a unit of currency as early as 775AD in Anglo-Saxon England, equivalent to 1 pound weight of silver. This was a vast fortune in the 8th century.
t wasn’t until 1694, after England’s naval defeat by France in 1690 at the Battle of Beachy Head, that the first central bank in history – the Bank of England – was born, having exclusive control over this hand-written monetary value.
In 1717, for the first time, the UK began to define the pound sterling’s value in terms of gold, not silver. This idea was launched across the globe officially in the 1800s when Germany adopted the idea and, as a result, encouraged mass international trade for the first time in history.
The pound sterling sign (£) is essentially just an elaborate ‘L’ that has a line struck through it to identify it as an abbreviation (of the Latin word ‘libra’). Italy’s pre-euro currency, the Italian lira (L), derived its name from the same origins as the pound and was also often symbolised by an ‘L’ with either one or two strikethrough lines (£ or ₤).
The influence of war on the pound
Being involved in a war and raising an army is extremely expensive. In an era, when troops had to be fed and armed, one reason for changes in the pound has been the need to fund military campaigns abroad. The establishment of the Bank of England itself was a result of William III’s need for funding to help him fight while during the 1st World War banknotes were issued and Britain came off the gold standard to pay for the massive debts incurred by the war.
The Royal Mint and the Bank of England
The development of the pound sterling as we know it today wouldn’t have been possible without the creation of two important institutions: the Royal Mint and the Bank of England. But did you know that in the past mints were found in most provincial towns and that the London Mint was just one of many across the country? Similarly, the Bank of England didn’t have a monopoly on the issue of banknotes until late into the 19th century.
While the British Pound has seen many variations during the centuries, it has remained a staple and oftentimes the strongest currency in the world. By not choosing to join the European Union and adopt the Euro, the United Kingdom has made a brave and controversial decision, but it remains the highest worth currency in the world. While its worth does fluctuate because it is traded on the free market, it is always one of the highest value currencies in the world.
