What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money stored and transferred in digital kind. Sounds easy enough, however how does it all work?
This type of currency is believed to be good to utilize for making purchases on the internet since if it works the way it was implied to, transactions should be rather anonymous and untraceable back to the payer or user.
This means that hackers would no longer have the ability to gather individual info from individuals who use their charge card to make online purchases. This would undoubtedly decrease the variety of taken identities that take place every day.
To assist you comprehend more of, “what is digital currency?” I have 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 unique qualities.
Here are just a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold stored in vaults. The gold supplies an additional measure of security and if you hold this kind of currency, you might potentially directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these companies allow you to send money all over the world as long as you have money in the account. For some services provided by these types of companies, 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. Also called Hard Electronic Currency, it is intended to be more like utilizing money to make your transaction however your deal is non-refundable once made. This type of system only works in one direction.
The E-cash idea has developed together with the development of the Internet. People just do not feel comfy with offering their individual credit card info online when purchasing.
A lot of bad things can occur like identity theft. No one wants their identity stolen.
Lots of business have attempted to create this type of payment or monetary system to lessen the threats of shopping online.
Many countries have actually successfully 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 after that all the cash is transferred into a bank. They can then utilize the card for anything they need to use it for.
Some nations are dealing with or have systems that permit the user to transfer cash through mobile phones. I think this is somewhat like what Chase lets their customers do. Their customers can take a photo of their check, front and back, with their phone and make their deposit digitally.
I do hope that this provides you some concept of what is digital currency and how it is trying 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 just one little post but I believe you can get a good concept.