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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money stored and transferred in digital form. Sounds simple enough, however how does it all work?
This type of currency is believed to be great to use for making purchases on the internet due to the fact that if it works the way it was suggested to, transactions must be rather confidential and untraceable back to the payer or user.
This means that hackers would no longer have the ability to gather individual info from individuals who utilize their credit cards to make online purchases. This would clearly decrease the number of stolen identities that take place every day.
To assist you comprehend more of, “what is digital currency?” I have done a fair bit of research on the subject and have discovered that there are numerous different types out there, each with it’s own special qualities.
Here are simply a few with their descriptions following:
1. Digital Gold Currency – This type is backed by gold stored in vaults. The gold provides an extra procedure of security and if you hold this kind of currency, you might potentially straight exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these business allow you to send cash all over the world as long as you have money in the account. For some services offered by these kinds of companies, you get charged a fee on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Likewise called Hard Electronic Currency, it is intended to be more like utilizing cash to make your deal but your transaction is non-refundable once made. This kind of system just works in one direction.
The E-cash idea has developed along with the development of the Web. Individuals just do not feel comfortable with giving their individual credit card info online when making a purchase.
Too many bad things can happen like identity theft. No one desires their identity stolen.
Many business have tried to develop this type of payment or monetary system to lessen the dangers of shopping online.
Lots of countries have successfully produced systems for “in-house” use such as Hong Kong’s Octopus card. This card works much like a sort of debit card where the user loads cash onto the card and then all the money is transferred into a bank. They can then use the card for anything they need to utilize it for.
Some countries are dealing with or have systems that permit the user to move money through mobile phones. I believe this is rather like what Chase lets their clients do. Their consumers can take a photo of their check, front and back, with their phone and make their deposit electronically.
I do hope that this gives you some concept of what is digital currency and how it is trying to take it’s place worldwide of e-commerce. There may be a little bit more to it than I might explain in just one little post but I believe you can get a good concept.