Fiat money is a government-issued currency that is not backed by a physical commodity like gold or silver. Its value is derived from people’s trust and confidence in the issuing government. Fiat money is used as a medium of exchange, store of value, and unit of account in economies worldwide. Examples include the US dollar, euro, yen, and other national currencies. It contrasts with commodity money, which has intrinsic value based on the material it is made of.