FIAT

FIAT Fiat money is currency issued and printed by a government. US dollars, euros, and pounds sterling are all types of fiat money. Because it's not backed by any commodity—like gold, for example—governments can decide how much of it is printed, giving them better control of their economy. However, since it's not linked to a stockpile of real commodities, too much fiat currency floating around can cause it to lose value, resulting in inflation—or even hyperinflation.