Its called intersubjective reality, and the world has literally always functioned that way. For example, the United States doesnt inherently exist. It exists because a collective of people subscribe to a common understanding of what it is and recognize it as existing and giving it meaning. Our laws dont inherently exist the way a rock or an apple exists. They arent reality, but they arent fiction either, because they do have some ability to create reality. But they only have ability to create reality as much as we subscribe to believing in them and perpetuating a system that enforces them. Money is the same thing, it has value because we ascribe it value. Otherwise its just green cloth paper. It has basically slightly more legitimate value than something ephemeral like a bitcoin.

Intersubjective reality is a cornerstone of human existence for all time. Even cave men had their own notions of intersubjective reality, despite none of them being states, laws, or money