Farcaster

"fiat" refers to traditional government-issued currency that is not backed by a physical commodity like gold or silver. examples of fiat currencies include the us dollar (usd), euro (eur), japanese yen (jpy), and british pound (gbp). fiat currencies derive their value from the trust and authority of the government that issues them.

in the world of cryptocurrency, fiat is often contrasted with digital currencies like bitcoin or ethereum. while cryptocurrencies operate on decentralized networks and derive value from their underlying technology and scarcity, fiat currencies rely on centralized authorities and the stability of the issuing government.

fiat currencies are used to buy and sell cryptocurrencies on exchanges, and they serve as a benchmark for the value of digital assets. many cryptocurrency exchanges offer fiat trading pairs, allowing users to trade cryptocurrencies directly with fiat currencies.

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