What it means
Money and its forms
Fiat monetary systems include physical cash and forms of account money. A bank balance, a central bank liability and a payment provider balance can have different legal and operational characteristics even when expressed in the same currency.
Fiat and crypto payments
A price quoted in fiat does not dictate which asset is transferred or when the merchant receives a bank payout. Conversion introduces a rate, timing, fees and counterparty arrangements. A dollar-referenced token is a separate instrument from the underlying sovereign currency.
Related concepts
In practice
A concrete example
An order priced in euros can be paid using an agreed cryptoasset, but the merchant separately records the exchange rate and any eventual euro payout.
Technical notes & boundaries
Legal-tender obligations and bank protections depend on the jurisdiction and instrument. A currency code does not make every balance denominated in it equivalent.
Go to the source.
Original references used for this definition. Product details and standards can change.