A term for traditional money issued by nation states in modern times which is backed by neither gold, silver nor any other item and has no intrinsic value other than the authority of the state. The word FIAT comes from the Latin “Let it be done” and means that the currency’s value is derived solely from state or royal decree. The US dollar and most other currencies are FIAT currencies. It is often used to draw a contrast between such paper currencies and cryptocurrencies such as Bitcoin that are backed by proof of work or other currencies that may be backed by the mining or storage of precious metals like gold or silver.
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