What is the difference between FIAT currencies and cryptocurrencies?
Fiat money (€, $, etc.) is currency that a government has declared to be
legal tender, but it is not backed by a physical commodity (like gold).
The value of fiat money is derived from the confidence it inspires and
the relationship between supply and demand rather than the value of the
material that the money is made of.
A cryptocurrency is a digital asset
designed to work as a medium of exchange that uses cryptography to
secure its transactions, to control the creation of additional units,
and to verify the transfer of assets.
Cryptocurrencies are a type of
fully digital, alternative, and in principle fully decentralized