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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash saved and moved in digital form. Sounds easy enough, but how does it all work?
This type of currency is thought to be good to utilize for making purchases on the internet since if it works the way it was indicated to, transactions should be rather confidential and untraceable back to the payer or user.
This suggests that hackers would no longer be able to collect personal info from people who use their credit cards to make online purchases. This would certainly reduce the variety of stolen identities that occur 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 numerous various types out there, each with it’s own special 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 provides an additional step of security and if you hold this type of currency, you could potentially straight exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these business permit you to send out money all over the world as long as you have cash in the account. For some services offered by these kinds of companies, you get charged a cost on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Called Hard Electronic Currency, it is meant to be more like using cash to make your transaction however your deal is non-refundable as soon as made. This kind of system just works in one instructions.
The E-cash concept has evolved along with the evolution of the Internet. People simply do not feel comfortable with providing their individual charge card info online when making a purchase.
Too many bad things can take place like identity theft. Nobody wants their identity stolen.
Many business have tried to develop this type of payment or financial system to reduce the threats of shopping online.
Numerous countries have effectively produced systems for “internal” usage such as Hong Kong’s Octopus card. This card works just like 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 use the card for anything they require to use it for.
Some countries are working on or have systems that enable the user to move money through mobile phones. I believe this is somewhat like what Chase lets their clients do. Their consumers can take an image of their check, front and back, with their phone and make their deposit digitally.
I do hope that this provides you some idea of what is digital currency and how it is trying to take it’s place worldwide of e-commerce. There may be a little more to it than I could explain in just one little article but I think you can get a good concept.