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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash saved and transferred in digital form. Sounds basic enough, however how does it all work?
This type of currency is thought to be great to use for making purchases on the internet because if it works the way it was implied to, deals should be rather confidential and untraceable back to the payer or user.
This suggests that hackers would no longer have the ability to collect personal details from people who use their charge card to make online purchases. This would undoubtedly decrease the number of stolen identities that take place every day.
To help you understand more of, “what is digital currency?” I have done a fair bit of research on the subject and have found that there are a number of different types out there, each with it’s own unique qualities.
Here are simply a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold kept in vaults. The gold supplies an additional step of security and if you hold this kind of currency, you could possibly directly exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these business enable you to send cash all over the world as long as you have money in the account. For some services supplied by these types of companies, you get charged a cost on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Also called Hard Electronic Currency, it is planned to be more like using cash to make your transaction however your transaction is non-refundable once made. This kind of system just works in one direction.
The E-cash concept has developed together with the evolution of the Internet. Individuals simply do not feel comfy with offering their individual credit card details online when purchasing.
Too many bad things can occur like identity theft. No one wants their identity taken.
Lots of companies have attempted to develop this type of payment or monetary system to reduce the threats of shopping online.
Numerous nations have effectively created systems for “in-house” usage such as Hong Kong’s Octopus card. This card works similar to a sort of debit card where the user loads money onto the card and after that all the money is deposited into a bank. They can then use the card for anything they require to use it for.
Some nations are working on or have systems that allow the user to transfer cash through mobile devices. I believe this is rather like what Chase lets their customers do. Their consumers can take an image of their check, front and back, with their phone and make their deposit digitally.
I do hope that this offers you some idea of what is digital currency and how it is trying to take it’s place on the planet of e-commerce. There may be a bit more to it than I might describe in simply one small post but I think you can get a great idea.