Cryptocurrency or Fiat Money

Before the widespread use of paper money, what were some items historically used as money?

• Cows, cowrie shells, and precious metals like gold and silver.

• Only gold and silver coins.

• Paper receipts from banks.

• Digital currencies and credit cards.

What defines fiat money?

• It is backed by a physical commodity like gold or silver.

• Its value is determined by its scarcity and demand in the market.

• It is declared legal tender by a government and is not backed by a physical commodity.

• It is a digital currency created and maintained by a decentralized network.

What does it mean for money to function as a "store of value"?

• It can be easily exchanged for goods and services.

• It maintains its purchasing power or increases in value over time.

• It can be divided into smaller units for transactions.

• It is issued and regulated by a central authority.

What is the primary purpose of money serving as a "unit of account"?

• To allow for peer-to-peer transactions without intermediaries.

• To enable the pricing of goods and services and facilitate giving change.

• To ensure its value remains stable over long periods.

• To be easily transportable and durable.

How do digital fiat money transactions typically differ from cryptocurrency transactions in terms of control and intermediaries?

• Both require a centralized intermediary to facilitate the exchange.

• Digital fiat transactions require intermediaries, while cryptocurrency transactions do not.

• Cryptocurrency transactions require intermediaries, while digital fiat transactions do not.

• Neither digital fiat nor cryptocurrency transactions require intermediaries.