Tag: FIAT money

Fiat money is a government-issued currency that has no intrinsic value and is not backed by a physical commodity like gold or silver. Its value is derived from government regulation and public trust in its stability. Fiat currencies, such as the U.S. dollar, euro, and yen, are widely used for transactions, savings, and investments. Unlike commodity money, it is subject to inflation and monetary policy changes controlled by central banks. Governments use it to regulate economies, adjusting interest rates and money supply. While convenient and widely accepted, fiat money can lose value due to excessive printing and economic instability.