½ Sovereign – Gibraltar

In 2012, Gibraltar's currency situation was defined by its unique political status and its practical economic integration with neighbouring Spain. As a British Overseas Territory, its official currency was (and remains) the Gibraltar pound (GIP), issued by the Government of Gibraltar and pegged at par with the Pound Sterling (GBP). Sterling notes and coins also circulated freely and were accepted interchangeably with local notes, creating a de facto dual-currency system underpinned by the UK's monetary policy.

However, the reality on the ground was more complex due to Gibraltar's location on the Iberian Peninsula. The euro, and particularly the Spanish peseta before it, had long been widely accepted in many retail and hospitality sectors to accommodate the large influx of day-visitors and cross-border workers from Spain. This created a highly dollarized environment where transactions could often be conducted in three currencies: GIP, GBP, and EUR. Exchange rates for euros were prominently displayed in shops and restaurants, reflecting the economic dependency on Spanish trade and tourism.

The year 2012 was significant as it fell during the prolonged aftermath of the Eurozone debt crisis, which heightened economic uncertainty in the region. While Gibraltar's banking sector remained stable, the volatility of the euro and pressures on the Spanish economy underscored the risks of its informal multi-currency system. This period reinforced Gibraltar's commitment to its Sterling peg as a symbol of economic stability and political identity, even as its businesses continued pragmatic acceptance of the euro to facilitate daily cross-border economic life.