What is the differences between commodity and fiat money?
Commodity money is generally used by nations who are unable to keep a stable currency, so the value of their currency is tied to a commodity (usually gold). This is usually done by growing economies, nations under social distress, or those simply wishing to avoid the hassle of having to deal with fiat money. Theoretically, unlike fiat money, commodity money can never be worth zero, so it carries with it less risk than fiat money, which could theoretically inflate to the point of no value (see German inflation in the early to middle part of the 1900s).
