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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash stored and moved in digital type. Sounds simple enough, however how does it all work?
This kind of currency is believed to be good 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 have the ability to collect personal info from people who use their credit cards to make online purchases. This would obviously reduce the number of stolen identities that occur every day.
To assist you understand more of, “what is digital currency?” I have done quite a bit of research on the subject and have discovered that there are numerous different types out there, each with it’s own unique qualities.
Here are simply 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 could perhaps directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these resemble PayPal and these business allow you to send money all over the world as long as you have cash in the account. For some services offered by these types of companies, 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 money to make your transaction however your transaction is non-refundable once made. This type of system just works in one direction.
The E-cash idea has evolved along with the development of the Web. Individuals simply do not feel comfy with giving their personal charge card details over the Internet when making a purchase.
Too many bad things can occur like identity theft. Nobody wants their identity taken.
So, many companies have attempted to create this kind of payment or monetary system to reduce the threats of shopping online.
Many nations have actually successfully created systems for “in-house” use 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 after that all the money is deposited into a bank. They can then utilize the card for anything they require to use it for.
Some countries are working on or have systems that allow the user to transfer money through mobile devices. I believe this is somewhat like what Chase lets their consumers do. Their consumers can take a picture of their check, front and back, with their phone and make their deposit electronically.
I do hope that this provides you some idea of what is digital currency and how it is attempting to take it’s location worldwide of e-commerce. There may be a bit more to it than I could explain in just one small post but I think you can get a good concept.