Fiat currency is money that is not backed by a physical commodity like gold or silver, but rather by the government’s guarantee that it can be used as a medium of exchange.
In other words, money that is printed out of nothing and backed by policy.
It is what most of the world uses.
Fiat currency is created and controlled by a central bank and it includes physical currency like cash and coins as well as digital currency like bank reserves.
Cryptocurrency (like Bitcoin) is a digital asset that uses cryptography to secure its transactions and to control the creation of new units. It operates independently of central banks and is decentralised, meaning it is not controlled by any government or institution.
Central Bank Digital Currency (CBDC) is a type of digital currency that is issued and backed by a country’s central bank. It is profoundly dangerous because it is programmable and entirely surveilled (hence it being tightly linked to digital ID).
John Titus has a YouTube channel in which he breaks apart financial matters. He argues that, in spite of fiat being backed by policy, cash is still king because it’s physical and its usage can remain anonymous. (For example, if you purchase something with cash, bankers don’t know what it is that you purchased.)