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History of Bitish Currency


Shaftsbury, Dorset - Athelstan had standard coinage made here

Money as we now know it grew out of trade by barter. Aristotle describes how the coinage of his time in the fourth century BC, developed in this way: "The various necessities of life are not easily carried about, and hence men agreed to employ in their dealings with each other something which was intrinsically useful and easily applicable to the purposes of life, for example, iron, silver and the like. Of this the value was at first measured by size and weight, but in the process of time they put a stamp on it to save the trouble and to mark the value" (Politics Book 1). This sums up the development of money. Barter was awkward. It was difficult to carry your cows around with you. Much better to carry around a representation of their value. By the sixteenth century Italian bankers were beginning to issue paper notes which would indicate that the holder of the notes had metal money to the value of the note in the bank. Trade in this paper money led to the modern business of banking and lending as we know it today.


Money, with its association with all that people value in life, provides an unrivalled window on wider history. In the case of Britain we can trace the slow evolution of England as a country through coinage. Coins reveal the earliest overseas trade engaged in by the British Isles, soon after Britain became an island around 10,000 years ago. The town of Hengistbury Head in Dorset found itself sitting beside a new sea, which offered possibilities for sea bourne trade. Coins left behind by this trade have been found at Hengistbury Head. Later in history, Roman coins reveal much about the well organised province of Britannia which endured for four centuries until around 400AD. Then with the Saxon invasions following the Roman withdrawal after 410AD, the break up of Britannia into chaotic statelets is mirrored by a loss of standard coinage. The powerful late eighth century Anglo Saxon leader King Offa of Mercia had coins which featured his name. This was an early example of a tradition which demanded that a monarch's name and representation had to appear on their coinage. At this point there were many different regional leaders with different names going on coins. Although the Royal Mint was established in 886 by King Alfred of Wessex, this was only one of many mints. The only standardisation, it seems, came in the way blank coins were made. There is no full agreement as to the derivation of the term "pounds sterling", but according to the Encyclopedia Britannica silver coins of that name were minted in various Anglo Saxon British territories in the eighth century, with the earliest example dated to 775. Coins were habitually minted from a basic unit of one pound of sterling silver, hence pound sterling. Standardisation of the design on coins themselves had to wait for the slow strengthening of a single royal authority. Many historians see this beginning to happen during the rule of Alfred's grandson Athelstan 924 - 939. Athelstan had coins made at a mint in Shaftesbury, Dorset, examples of which can still be seen at Shaftesbury's Goldhill Museum. His coins were all part of his desperate attempt to hold together the bewildering ethnic concoction of England at this time. Athelstan can be largely credited with developing the idea of the divine right of kings as it applies to the British monarchy. Part of the projection of this ruling image was the attempt to put Athelstan's name and face on all coins. The fact that monarchs faces have traditionally appeared on coins indicates the basic link between royal authority, national identity and money. This is what makes arguments about changes to national currencies today so emotionally charged. Money isn't simply a representation of value to facilitate trade and exchange. Money is also a national symbol.

The role of money as a national symbol is also seen in the small details on British coins. On British coins you will see the initials F.D. stamped around the edge. These letters stand for Fidei Defensor, or Defender of the Faith. The story behind these two little initials dates back to 1521 when Pope Clement endowed Henry VIII with the title Defender of the Faith. Martin Luther, founder of Protestantism, was threatening the power of the Catholic Church. Henry VIII wrote to Charles V, the Holy Roman Emperor, to denounce the dangers of Luther's new religious ideas. Pope Clement saw the letter, and was so impressed that he gave Henry his title of Defender of the Faith. There was no mention of inheritance of the title as it was granted to Henry alone. Nevertheless after Henry cut himself off from Rome and converted England to Protestantism, to enable his divorce from Catherine of Aragon, he retained the title. The fact that he was now defender of a different faith was a minor detail which could be ignored. In 1543 the title was annexed to the crown by act of Parliament. British monarchs have carried the title ever since, and those letters F.D. are still carried on British coins today. So the present queen, a Protestant monarch of a Protestant Church of England which she promises to defend, is actually sporting a Catholic title awarded for opposition to the founder of Protestantism. The most important thing about this inscription is that it is a reminder of a moment when the international authority of the pope was replaced by the national authority of a monarch. All of these historic symbols of royal authority survive on British coinage, and have continued on beyond the decimiisation that took place in 1971. Perhaps given all this history and weight of symbolism, it is not surprising that Britain, unlike most other European counties, has not adopted the Euro.

There is a coin museum at the Royal Mint in Llantrisant, south Wales, but this is not open to the public. One of the best accessible collections of coins, both British and foreign can be found at the Fitzwilliam Museum in Cambridge. There is also a display of historic coins and bank notes at the British Museum.






©2006 InfoBritain (updated 01/11)