What are the differences between fiat currencies and cryptocurrencies?

1. Fiat currencies are issued by a government and therefore are recognized as legal tender, whereas cryptocurrencies are not regulated by any government or central authority.

2. Fiat currencies typically have physical notes and coins associated with them while cryptocurrencies exist only in digital form, meaning they have no physical representations.

3. Fiat currencies are backed by the full faith and credit of the issuing government and can be printed, while cryptocurrencies are decentralized digital assets with no physical counterpart and no central issuer.

4. Fiat currencies are controlled by central banks and monetary policy, while cryptocurrencies are decentralized and not subject to the will of any centralized authority.

5. Fiat currencies are traded in traditional financial institutions while cryptocurrencies are traded solely in the digital sphere.

6. Fiat currencies have a finite supply while cryptocurrencies have unlimited supply depending on the type.

7. Fiat currencies are taxed where cryptocurrencies are either tax exempt or taxed at a lower rate.