Money plays a significant role in our day-to-day lives in various forms, for business, education or anything else in the purchase.
There are various forms of currencies used across the globe. They have separate names as well as different values. Few nations have currencies like the rupee, dollar, pound, and taka, yuan.
Whenever someone travels from one nation to another, and their currencies differ, they must exchange them into the form used in the nation.
When compared to another, the price of one currency helps determine the nation’s economic status and health, which is directly related to the well-being of the people residing in the country.
Key Takeaways
- The Pound and Dollar are both currencies widely used in different parts of the world as mediums of exchange.
- The Pound is the official currency of the United Kingdom, while the Dollar is the official currency of the United States of America.
- The Pound is symbolized by the “£” sign, while the “$” sign symbolizes the Dollar, and both currencies are exchangeable in the Forex market.
Pound vs Dollar
The difference between the pound and the dollar is that the pound has more value than the dollar. The dollar is used in Western countries like Australia, Hong Kong etc., whereas Pound is used in central countries like Great Britain, Sudan and Syria.
The pound was the word used to signify the weight of silver in the past. The word itself is derived from the Latin word ‘Libra’, which meant a unit of the account of the Roman Empire. In the history of the Pound, we see that in Great Britain, the pound was used to weigh the silver used to make a coin or ‘currency’.
The dollar is represented with the ‘$’ symbol. The term originated in 1520 from Bohemia when the country had just started manufacturing coins of silver in Joachimsthal. Generally, 1$ signifies 100 cents. The dollar is the common currency used in countries like New Zealand, Taiwan, The United States, Hong Kong, Namibia and many other western countries.
Comparison Table
| Parameters of Comparison | Pound | Dollar |
|---|---|---|
| Symbol of the Currency | £ | $ |
| Value in rupees | 1 £=102.54 Indian Rupee | 1$= 74.76 Indian Rupee |
| Place of Origin | Anglo- Saxon England | Joachimsthal in Bohemia |
| Year of Origin | 775AD | 1520 |
| Countries they are used in | Great Britain, Sudan, Syria, Lebanon, Egypt | New Zealand, Taiwan, The United States, Hong Kong, Namibia |
What is Pound?
The pound is one of the oldest modes of currency, which has its roots in the European Continent. The term originated due to Charlemagne’s currency reform in the Empire of Frankish.
The literal word can have a direct reference from the Latin word “pondus’ which means a unit of weight.
This was afterwards taken to Great Britain, where it was considered the value of a pound of silver, or what we can refer to as the ‘weight of silver’.
The first ever pound coin appeared under the reign of Henry VII in the year 1489.
The pound notes started being circulated in England in 1694, shortly after the foundation of The Bank of England.
After decimalisation in 1971, 1 pound was divided into 100 pence. The singular of pence is ‘penny’, and the symbol of the latter is ‘p’.
The pound has both coins as well as banknotes or paper currency. The banknotes available currently are 5-pound notes, 10-pound notes, 20-pound notes and 50-pound notes.
Moreover, there are 1 pound banknotes. But they are found very rarely as they are printed only in Scotland.
There is a fascinating fact about Pound. Near about 980 AD, one pound was enough to buy approximately 15 cattle.
What is Dollar?
The dollar is a general name for more than 20 currencies.
The list includes the Australian Dollar, Singapore Dollar, Taiwan Dollar, Jamaican Dollar, New Taiwan Dollar, Hong Kong Dollar, Canadian Dollar and many more.
The origin of this currency can be traced back to the year 1520, 15th January. The Kingdom of Bohemia began manufacturing coins made up of silver in the local area of Joachimsthal.
The coins were initially named after the town and were called Joachimsthaler. Later on Joachimsthaler shorten into thaler or taler.
There are seven denominations of banknotes for dollars. They are 1, 2, 5, 10, 20, 50 and 100. Since 1956, all the banknotes have a printed motto- “In God We Trust”.
The Dollar notes for better longevity are not made of paper but are made using cotton- a linen blend.
Single dollar banknotes have a durability of just 18 months, whereas 20 dollar notes are circulated for 2 years at an average rate. However, banknotes of 50 and 100 Dollars stay in circulation for about eight years.
After adopting the “Coinage Act”, the first silver dollars were issued in 1794.
The decree was associated with the establishment of the first American National Mint and assisted in setting the dollar as the reference unit for the whole nation.
Also, numerous acts have been passed, affecting the amount and type of metal which are supposed to be used in the coins of the US.
There is no specific definition, but what is the closet one we have lies in Section 5116, paragraph b, subsection 2 of the United States Code Title 31, which states, “The Secretary [of the Treasury] shall sell silver under conditions the Secretary considers appropriate for at least $1.292929292 a fine troy ounce.
Main Differences Between Pound and Dollar
- The pound is used in the major countries, whereas Dollar is used in Western Countries.
- The pound has more monetary value than the Dollar.
- The word Pound originated from the Latin meaning of ‘Libra’, whereas Dollar was adapted as English from the Dutch origin word ‘Daler’.
- The pound is represented by ‘£’. The dollar is represented by ‘$’.
- The pound is the currency of the Central Countries, whereas Dollar is the currency of the Western Countries.
- https://www.sciencedirect.com/science/article/pii/S1057521999800398
- https://www.sciencedirect.com/science/article/pii/S1062940804000038
Last Updated : 11 June, 2023
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
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