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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money kept and transferred in digital type. Sounds easy enough, however how does it all work?
This type of currency is thought 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, deals must be rather anonymous and untraceable back to the payer or user.
This means that hackers would no longer have the ability to collect personal info from individuals who utilize their credit cards to make online purchases. This would obviously decrease the number of taken identities that occur every day.
To help you understand more of, “what is digital currency?” I have actually done a fair bit of research on the subject and have discovered that there are a number of different types out there, each with it’s own distinct 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 supplies an extra step of security and if you hold this kind of currency, you could possibly straight exchange it for solid gold bullion.
2. Centralized Currency Systems – these resemble 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 supplied by these types of business, you get charged a cost on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Called Hard Electronic Currency, it is meant to be more like using cash to make your transaction but your deal is non-refundable as soon as made. This type of system just works in one direction.
The E-cash idea has actually developed in addition to the development of the Web. Individuals just do not feel comfortable with giving their personal credit card details over the Internet when buying.
A lot of bad things can happen like identity theft. Nobody wants their identity taken.
Lots of business have tried to develop this type of payment or monetary system to lessen the dangers of shopping online.
Many countries have actually effectively 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 deposited into a bank. They can then utilize the card for anything they need to utilize it for.
Some nations are dealing with or have systems that allow the user to move money through mobile phones. I believe this is somewhat like what Chase lets their customers do. Their customers can take a picture of their check, front and back, with their phone and make their deposit electronically.
I do hope that this offers 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 may be a little bit more to it than I might explain in simply one little article but I believe you can get a good idea.