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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money stored and moved in digital kind. Sounds easy enough, but how does it all work?
This type of currency is believed to be good to use for making purchases on the internet since if it works the way it was meant to, deals need to be rather anonymous and untraceable back to the payer or user.
This suggests that hackers would no longer have the ability to collect individual information from individuals who use their credit cards to make online purchases. This would clearly decrease the variety of stolen identities that occur every day.
To help you comprehend more of, “what is digital currency?” I have done quite a bit of research on the subject and have found that there are numerous different types out there, each with it’s own unique qualities.
Here are just a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold kept in vaults. The gold offers an additional step of security and if you hold this kind of currency, you might potentially directly exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these companies enable you to send out cash all over the world as long as you have cash in the account. For some services offered by these types of business, you get charged a charge on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Called Hard Electronic Currency, it is planned to be more like using cash to make your transaction but your transaction is non-refundable as soon as made. This kind of system just works in one instructions.
The E-cash idea has evolved in addition to the development of the Internet. Individuals just do not feel comfortable with giving their individual charge card info online when making a purchase.
A lot of bad things can happen like identity theft. Nobody desires their identity taken.
So, lots of business have tried to produce this type of payment or monetary system to reduce the risks of shopping online.
Many countries have successfully created systems for “internal” use such as Hong Kong’s Octopus card. This card works similar to a sort of debit card where the user loads cash onto the card and after that all the cash is transferred into a bank. They can then use the card for anything they require to utilize it for.
Some nations are dealing with or have systems that enable the user to transfer money through mobile phones. I think this is rather like what Chase lets their clients do. Their clients can take a picture 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 location worldwide of e-commerce. There may be a bit more to it than I could describe in just one little post but I think you can get an excellent concept.