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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money saved and moved in digital type. Sounds easy enough, however how does it all work?
This type of currency is thought to be excellent to use for making purchases on the internet because if it works the method it was suggested to, transactions must be rather anonymous and untraceable back to the payer or user.
This means that hackers would no longer be able to gather personal information from people who utilize their credit cards to make online purchases. This would certainly 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 study on the subject and have actually discovered that there are a number of various 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 supplies an extra measure 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 are like PayPal and these business enable you to send cash all over the world as long as you have cash in the account. For some services supplied by these kinds of business, you get charged a charge 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 intended to be more like using money to make your deal but your deal is non-refundable when made. This type of system only operates in one direction.
The E-cash idea has actually developed in addition to the development of the Web. Individuals simply do not feel comfy with offering their individual credit card information over the Internet when making a purchase.
A lot of bad things can take place like identity theft. Nobody wants their identity stolen.
Lots of business have attempted to develop this type of payment or monetary system to decrease the dangers of shopping online.
Lots of countries have effectively created systems for “in-house” usage 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 after that all the cash is deposited into a bank. They can then utilize the card for anything they require to use it for.
Some nations are working on or have systems that permit the user to transfer money through mobile devices. I think this is somewhat like what Chase lets their consumers do. Their customers can take a photo 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 on the planet of e-commerce. There may be a little bit more to it than I might explain in simply one small post but I believe you can get a great concept.