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Fiat currency is legal tender whose value is backed by the government that issued it. The US. dollar is Fiat money, as are the EURO, GBP and many other major world currencies.
Fiat currencies can be increase and decrease in value compared to other Fiat currencies or commodities and assets.
The model behind government backed Fiat currencies differs to both commodities such as gold or silver. And to the new digital currencies known as cryptocurrencies.