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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money saved and moved in digital type. Sounds simple enough, but how does it all work?
This type of currency is thought to be good to use for making purchases on the internet since if it works the method it was suggested to, transactions must be rather confidential and untraceable back to the payer or user.
This suggests that hackers would no longer be able to gather individual info from individuals who use their charge card to make online purchases. This would undoubtedly decrease the variety 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 on the subject and have found that there are numerous various types out there, each with it’s own unique qualities.
Here are just a few with their descriptions following:
1. Digital Gold Currency – This type is backed by gold kept in vaults. The gold supplies an extra step of security and if you hold this type of currency, you might perhaps directly exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these companies enable you to send 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 transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Also called Hard Electronic Currency, it is meant to be more like using money to make your deal however your deal is non-refundable as soon as made. This type of system only works in one direction.
The E-cash concept has developed together with the development of the Internet. Individuals just do not feel comfortable with providing their individual charge card details over the Internet when making a purchase.
A lot of bad things can happen like identity theft. No one desires their identity stolen.
So, lots of business have tried to create this type of payment or monetary system to lessen the threats of shopping online.
Lots of countries have effectively created systems for “internal” usage such as Hong Kong’s Octopus card. This card works much 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 need to use it for.
Some countries are dealing with or have systems that permit the user to transfer money through mobile phones. I believe this is somewhat like what Chase lets their customers do. Their clients can take an image of their check, front and back, with their phone and make their deposit electronically.
I do hope that this provides you some concept 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 might explain in simply one little article however I think you can get a great idea.