With a large amount you might get asked to prove your identity and asked how you came by it (anti money laundering checks). When you change it take your passport with you.
Opening a dollar bank account, I was asked to:
Fill in some 10 paper forms, stating that I am not a US citizen ("under full legal liability"). That I am not a terrorist, nor planning to become one, nor having been associated with any such organization. And a whole load of other crap I can't even remember.
As far as conversion goes, I think 5$ for one pound is not a good deal. It's better to invest in real estate - I hear the prices will soar. I can offer a high quality brick for 2000$. It's in mint condition, a bargain: