Value is generated by work, but valorization is based on processes of use or exchange. Generally assets have intrinsic value. Fiat currency has no intrinsic value. Its value derives from the state assuring a demand for goods and labor, which will be purchased in the currency, from assuring the availability of investment assets, which will promise a return above an original value, and from regulating the supply, to assure that the values of ordinary goods will remain generally stable.

Centralized, minted currencies definitely did not exist before states started using them. Minted currencies were invented multiple times independently across multiple cultures, but one of the biggest through lines between them is that they required a centralized state who held large reserves, and that they were, in every known case, used to support standing armies for those states.

Fiat money maintains its value largely because the government will purchase labor, goods, and other assets without any concern for gain versus loss.

The state therefore generates demand even when and where private entities will not or cannot hire workers, make purchases, or invest.

If wages rise with inflation, then workers gain relative to those with accumulated fortunes.