The term `hard currency` is used to describe a currency that is not easily convertible into other forms of currency. Hard currency refers to currencies such as the U.S. dollar, the euro, or the British pound. These currencies are usually held by individuals or institutions that are considered to be stable, and are not easily exchanged for other forms of currency.

This stability is important because it allows investors to invest in hard currencies without fear of future price fluctuations. This is often helpful for investors as it allows them to diversify their holdings and reduce their risk levels.

Another important characteristic of hard currencies is their liquidity.