1 Crown – Isle of Man

In 2007, the Isle of Man's currency situation was defined by its unique political status as a British Crown Dependency. While not part of the United Kingdom, the Island's long-standing monetary policy was to align its currency with that of its largest trading partner. Consequently, the official currency was the Manx pound, which was issued by the Isle of Man Government and maintained a fixed parity at a 1:1 exchange rate with the pound sterling. Sterling notes and coins also circulated freely and were accepted as legal tender alongside distinct Manx-issued notes and coins, which featured local symbols and imagery.

This system provided significant economic stability, as it effectively outsourced central banking functions, like interest rate setting and monetary policy, to the Bank of England. For the Island's key sectors of offshore banking, insurance, and e-gaming, this stability was crucial, ensuring predictability for international investors and businesses. However, this arrangement also meant the Isle of Man had no independent monetary lever to respond to local economic conditions, being entirely subject to the UK's economic cycles and policy decisions.

The year 2007 itself was a calm before the storm within this established framework. The global financial crisis, which began to unfold in mid-2007, had not yet precipitated any immediate changes to the Island's currency peg. The system's resilience was untested, but the fixed link to sterling would soon face significant pressure as the crisis deepened into 2008, raising questions about banking stability and the implications of being tied to a major currency during a period of extreme volatility.