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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash stored and transferred in digital form. Sounds basic enough, but how does it all work?
This type of currency is thought to be good to use for making purchases on the internet because if it works the method it was meant to, transactions need to 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 charge card to make online purchases. This would certainly reduce the number of taken identities that take place 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 actually found that there are numerous various types out there, each with it’s own distinct 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 extra measure of security and if you hold this type of currency, you might potentially straight exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these business allow you to send money all over the world as long as you have money in the account. For some services offered by these types of business, you get charged a fee 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 money to make your transaction but your transaction is non-refundable when made. This kind of system just works in one instructions.
The E-cash idea has progressed together with the development of the Internet. People simply do not feel comfortable with giving their personal charge card details online when making a purchase.
Too many bad things can occur like identity theft. Nobody wants their identity taken.
Lots of companies have attempted to create this type of payment or financial system to decrease the risks of shopping online.
Lots of countries have effectively developed systems for “internal” use 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 transferred into a bank. They can then use the card for anything they need to use it for.
Some nations are working on or have systems that permit the user to move cash through mobile phones. I think this is somewhat like what Chase lets their customers 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 gives you some idea of what is digital currency and how it is attempting to take it’s location in the world of e-commerce. There may be a bit more to it than I could describe in simply one small post however I think you can get an excellent idea.