"We don't "say" GBP": many people do, actually, at least in contexts where one normally uses ISO codes. "British citizen" is the statutory name of citizenship of the UK, so it's not so much a choice of the government (in the sense of the particular set of ministers in place at any given time) as of parliament.
This Wikipedia article gives this explanation for the origin of the word gee-gee: The Chester Racecourse site was home to the famous and bloody Goteddsday football match. The game was very violent and, in 1533, banned by the city, to be replaced in 1539 by horse racing. The first recorded race was held on with the consent of the Mayor Henry Gee, whose name led to the use of ...