Fiat currencies are monies issued by the state, such as the euro, dollar or yen. The FIAT currency has no intrinsic value, it is not covered by a physical commodity such as gold or silver. However, it serves as a means of exchange and is prescribed as legal tender.
Most modern paper currencies are fiat currencies, including the US dollar, the euro and other major global currencies.
The word “fiat” comes from Latin and is often translated with the decree “it shall be” or “it shall be done”.