Traditional Currency

Traditional currency refers to the well-known paper or coin money that is issued and backed by a government. It is also known as fiat currency. The value of traditional currency is determined by supply and demand, as well as the stability of the issuing government.

Types of Traditional Currency

1. Commodity money: This is a type of currency that has value beyond its use as currency. Examples of commodity money include gold, silver and other precious metals.
2. Representative money: This is currency that is backed by a physical commodity such as gold or silver.
3. Fiat money: This is currency that has no intrinsic value and is not backed by a physical commodity. The value of fiat money is based on the stability of the issuing government and the supply and demand in the market. Examples of fiat money include the US dollar, the Euro, and the Japanese yen.

While traditional currency has been the primary form of currency for centuries, the rise of cryptocurrency has brought new alternatives to the table.

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