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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money kept and transferred in digital kind. Sounds basic 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 method it was implied to, transactions need to be rather confidential and untraceable back to the payer or user.
This indicates that hackers would no longer have the ability to gather individual info from people who use their charge card to make online purchases. This would obviously reduce the number of stolen identities that occur 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 several 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 saved in vaults. The gold offers an additional step of security and if you hold this kind of currency, you could perhaps straight exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these business allow you to send cash all over the world as long as you have cash in the account. For some services offered by these kinds of business, you get charged a fee on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Likewise called Hard Electronic Currency, it is meant to be more like using cash to make your transaction however your transaction is non-refundable as soon as made. This kind of system only operates in one direction.
The E-cash idea has actually developed in addition to the advancement of the Internet. Individuals just do not feel comfortable with offering their personal credit card information over the Internet when purchasing.
Too many bad things can happen like identity theft. Nobody desires their identity stolen.
So, lots of companies have actually tried to create this type of payment or monetary system to reduce the threats of shopping online.
Many nations have actually effectively produced systems for “internal” 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 then all the cash is transferred into a bank. They can then utilize the card for anything they need to use it for.
Some countries are dealing with or have systems that allow the user to move money through mobile devices. I believe this is somewhat like what Chase lets their customers do. Their consumers can take a photo of their check, front and back, with their phone and make their deposit digitally.
I do hope that this gives you some concept of what is digital currency and how it is attempting to take it’s place in the world of e-commerce. There might be a bit more to it than I could describe in just one little post however I think you can get an excellent concept.