Fiat currency is paper money created by government decree that is not backed by a physical asset with intrinsic value. As of 2020, there are approximately 180 fiat currencies worldwide.
Examples of fiat currencies are the U.S. dollar, the European Euro, and Japanese Yen, among many others.
To understand how fiat currencies work, let’s look at one specific example, the U.S. dollar. Of course, thanks to globalization, the same system that applies to the U.S. dollar now applies to fiat currencies worldwide. [Read more…] about What Is Fiat Currency? And How Does It Affect You?