U.S.bank notes have no intrinsic value and yet are widely accepted as a medium of exchange.This is a result of:

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The fiduciary monetary system relies on the acceptance of money as a medium of exchange, despite having no intrinsic value. This is because people trust that others will also accept it as payment, creating a system of trust and confidence in the value of the currency. Gresham's law applies to situations where there are multiple types of currency in circulation with differing intrinsic values, and states that people will tend to hoard the currency with the higher value and spend the currency with the lower value. The use of money as a store of value refers to the ability of money to hold its value over time, and is one of the functions of money. Valuation of currency as commodity money refers to a monetary system where the currency itself has value based on its material composition, such as gold and silver coins. The gold and silver reserves of the Federal government that backs the currency were historically important, but are no longer the basis of the fiduciary system in the US.

USBank Notes Have No Intrinsic Value and Yet Are Widely