The foreign exchange market refers to a trading place that engages in foreign exchange transactions and regulates foreign exchange supply and demand internationally. Its function is to trade monetary goods, that is, the currencies of different countries.
It refers to various means of payment expressed in foreign currency, which are generally accepted by all countries and can be used for international settlement of creditor's rights and debts.
It must have three characteristics: affordability (assets that must be expressed in foreign currency), availability (claims that can be compensated abroad) and convertibility (foreign currency assets that can be freely converted into other means of payment).