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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: cash stored and transferred in digital form. Sounds easy enough, however how does it all work?
This kind of currency is believed to be excellent to utilize for making purchases on the internet because if it works the method it was meant to, deals must be rather confidential and untraceable back to the payer or user.
This suggests that hackers would no longer be able to collect personal details from people who utilize their charge card to make online purchases. This would certainly decrease the number of stolen identities that happen 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 actually 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 supplies an additional step of security and if you hold this type of currency, you might perhaps straight exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these business permit you to send out money 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 transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Called Hard Electronic Currency, it is planned to be more like utilizing cash to make your transaction but your transaction is non-refundable when made. This kind of system just works in one direction.
The E-cash concept has evolved in addition to the advancement of the Web. Individuals just do not feel comfy with providing their individual credit card details online when making a purchase.
Too many bad things can occur like identity theft. No one desires their identity stolen.
Many companies have tried to develop this type of payment or financial system to lessen the threats of shopping online.
Numerous countries have successfully produced systems for “internal” usage such as Hong Kong’s Octopus card. This card works just like a sort of debit card where the user loads money onto the card and then all the money is transferred into a bank. They can then use the card for anything they require to use it for.
Some nations are dealing with or have systems that allow the user to move money through mobile phones. I think this is somewhat like what Chase lets their customers do. Their clients can take an image of their check, front and back, with their phone and make their deposit electronically.
I do hope that this provides you some concept of what is digital currency and how it is attempting to take it’s place worldwide of e-commerce. There may be a little bit more to it than I could describe in simply one small post but I think you can get a good concept.