Modern Economic Nonsense — Payment apps move away from the fiat currency

xuanling11
Coinmonks
Published in
4 min readJul 1, 2022

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The world’s financial system is becoming increasingly digital, and numerous payment apps are cashing in on the trend. PayPal, Chase QuickPay, and American Express are just a few companies offering digital wallet solutions to make it easier for consumers to pay with their cards. These types of solutions can be beneficial for those who don’t have bank accounts or access to a brick-and-mortar location. Most people rely on credit card payments as their primary method of financing purchases, making digital wallet solutions a popular solution for remittance services and micropayments. Understanding how these payment apps work helps us understand how traditional ways of making money operate. We all need money to live our lives; it’s also something you can exchange for goods or services from someone else. Many new payment platforms are moving away from fiat currency because the banking system isn’t keeping up with how quickly things are changing.

What is money?

Money is a commodity that represents the first and most important store of value. Money is what allows us to exchange one good or service for another. It’s also an easy way to measure value and an indicator of economic activity. For example, if we see more money in circulation, it means that more goods and services are being traded. Numerous types of money exist today, including fiat money, digital currency, and cryptocurrency.

Fiat currency and how it works

Fiat currency is money that is backed by government regulation. A fiat currency is also called a paper money because it’s made up of paper bills that are recognized and accepted as payment in exchange for goods and services. Fiat currency has no intrinsic value, so it’s simply a piece of paper that the government has authorized as a legal tender. The paper itself has no actual physical value. The most commonly used fiat currencies include the U.S. dollar, the Euro, the Japanese Yen, and the Chinese Yuan. Fiat currencies can also be created via central banking, where the central bank creates fiat money through open market operations. These types of operations are carried out by the Federal Reserve, Bank of England, and Bank of Japan. The central bank places a purchase order for various…

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