5 Pounds – Gibraltar

In 2004, Gibraltar's currency situation was defined by its unique political status as a British Overseas Territory and its practical economic integration with neighbouring Spain. The legal tender was, and remains, the Gibraltar pound (GIP), issued by the Government of Gibraltar and pegged at par with the British pound sterling (GBP). Sterling notes and coins also circulated freely and were accepted interchangeably with local currency, reflecting Gibraltar's constitutional link to the United Kingdom. However, the Gibraltar pound was not legal tender in the UK, creating a one-sided currency union.

A significant development in 2004 was Gibraltar's inclusion in the European Union's Treaty of Accession, which it had joined with the UK in 1973. This formalised the acceptance of the euro for transactions within Gibraltar, a practice already commonplace due to the territory's heavy reliance on cross-border trade, tourism, and workers from Spain. Many retail businesses, especially those in the main town area, readily accepted euros, though often at an exchange rate less favourable than the official rate, providing convenience for visitors but reinforcing the Gibraltar pound as the primary currency for domestic use.

Thus, the 2004 landscape was one of a hybrid and pragmatic system. The territory maintained its sovereign currency pegged to sterling for official and domestic purposes, while simultaneously accommodating the euro as a de facto secondary currency to facilitate its vital economic links with the European Single Market. This arrangement underscored Gibraltar's dual identity: politically British and economically connected to the Iberian Peninsula.