In my latest FEE article, I clarify the definition of “fiat money” and I also explain that the State doesn’t have the power to make something money “by fiat.”
On social media, people have been pushing back against me, citing (e.g.) legal tender laws. I specifically addressed this in the article, but let me be clearer here: Of course such regulations are relevant (otherwise the State wouldn’t implement them). But they aren’t sufficient. In the historical episodes where a State-issued currency collapsed (like Weimar Germany or modern-day Zimbabwe), it wasn’t because the governments foolishly repealed a pre-existing legal tender law.