What is Fiat Money?
Fiat currency is a modern form of currency issued and guaranteed by a national government. Unlike commodity money based on precious metals, this currency derives its value solely from the trust and recognition of society in the issuing authority.
Unlike traditional commodity money, fiat money is not tied to its intrinsic value but rather derives its value from the trust and commitment of the issuing authority to maintain stable macroeconomic conditions. The government controls the money supply, ensuring liquidity and stability through monetary and fiscal policy tools.
