Definition of the term fiat
Fiat currency or fiat money is a currency issued by a government and central banks, that is not backed by a commodity such as gold. Often, ‘fiat’ is mentioned if people refer to a currency like dollars, euros or yen, all which is not crypto.
Fiat used in a sentence
‘’The term is derived from the Latin word fiat, which means a determination by authority.’’
‘’it is an illusion that you gain wealth from crypto, fiat is just collapsing.’’
‘’I am going to convert my fiat into crypto currency.’’
History of the term fiat
The name “fiat” comes from the Latin word fiat, which means “it shall be” or “let it be done.” As a result, fiat currencies only have value because the government sustains it; fiat money has utility in itself.
More recently, the term is being used more frequently in order to distinguish crypto currencies from government money. Often, it is being used in a mockery sense. Even mainstream media had published about it Article.
The premise of fiat currency is that it can potentially be printed into oblivion while the majority of crypto currencies have a limited amount of supply. This means that fiat currency is less scarce and can more easily be copied, this implies that cryptocurrencies might be a superior store of value.