Fiat vs Stablecoins vs Bitcoin 🚀 TL;DR • Stablecoins are the digital bridge to escape fiat. • Bitcoin is the exit from the fiat system itself. ⸻ 1️⃣ Issuer • Fiat: Central Banks (e.g. RBA, Fed) • Stablecoins: Private companies or DAOs (e.g. Tether, Circle) • Bitcoin: No issuer – mined by network ⸻ 2️⃣ Backed By • Fiat: Govt trust & economy • Stablecoins: Fiat or crypto reserves • Bitcoin: Math, code, and fixed scarcity ⸻ 3️⃣ Supply Cap • Fiat: Unlimited (inflationary) • Stablecoins: Pegged to fiat • Bitcoin: Fixed – 21 million ⸻ 4️⃣ Control • Fiat: Centralized (govt/central banks) • Stablecoins: Semi-centralized (issuer or smart contracts) • Bitcoin: Decentralized – no single authority ⸻ 5️⃣ Inflation Risk • Fiat: High – value drops over time • Stablecoins: Medium – depends on peg & reserves • Bitcoin: None – deflationary by design ⸻ 6️⃣ Censorship Resistance • Fiat: Low – easily frozen or seized • Stablecoins: Medium – depends on issuer • Bitcoin: High – cannot be blocked ⸻ 7️⃣ Legal Tender • Fiat: Yes – used for taxes, wages, etc • Stablecoins: No – but widely used online • Bitcoin: No (except El Salvador), growing adoption ⸻ 8️⃣ Transparency • Fiat: Opaque – govt-controlled data • Stablecoins: Varies – some audited, some not • Bitcoin: Fully auditable public ledger ⸻ 9️⃣ Use Case • Fiat: Everyday transactions, legal obligations • Stablecoins: Crypto trading, remittances, DeFi • Bitcoin: Store of value, digital gold, opt-out of fiat ⸻ 🔟 Trust Model • Fiat: Trust in government & policy • Stablecoins: Trust in issuer or code • Bitcoin: Trustless – enforced by protocol ⸻ Quick Analogy • 🏦 Fiat = The government’s money. Widely accepted, but loses value and can be controlled or frozen. • 🪙 Stablecoins = Digital fiat proxies. Fast, useful in crypto, but depend on trust in issuer and peg stability. • ₿ Bitcoin = Digital sovereignty. Scarce, trustless, censorship-resistant, and outside of traditional financial systems.