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You're close. Fiat money has value when it's backed by something. The US$ is backed by the US government. It's still fiat money.
by arbitrage 4y ago
You're close. Fiat money has value when it's backed by something. The US$ is backed by the US government. It's still fiat money.
- olalonde 4y agoIt is "backed" as in endorsed, or supported, by the US government. In the same sense that Bitcoin is "backed" by its many worldwide supporters and miners. It is not "backed" in the traditional meaning of being redeemable for something else at a fixed rate ("backed by gold", "backed by silver", etc.).