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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money saved and moved in digital type. Sounds easy enough, however how does it all work?
This type of currency is believed to be great to use for making purchases on the internet since if it works the way it was meant to, deals need to be rather anonymous and untraceable back to the payer or user.
This indicates that hackers would no longer be able to collect personal details from individuals who utilize their credit cards to make online purchases. This would certainly decrease the number of stolen identities that occur every day.
To help you understand more of, “what is digital currency?” I have actually 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 saved in vaults. The gold provides an extra step of security and if you hold this kind 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 cash all over the world as long as you have cash in the account. For some services offered by these types of business, you get charged a cost 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 however your transaction is non-refundable once made. This kind of system just works in one direction.
The E-cash idea has developed in addition to the evolution of the Web. Individuals just do not feel comfortable with providing their individual credit card info online when purchasing.
Too many bad things can take place like identity theft. No one wants their identity taken.
Numerous business have actually attempted to produce this type of payment or monetary system to lessen the threats of shopping online.
Many countries have successfully produced systems for “internal” 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 then all the cash is transferred into a bank. They can then use the card for anything they require to use it for.
Some nations are working on or have systems that enable the user to move money through mobile devices. I think this is somewhat like what Chase lets their consumers do. Their customers can take a photo of their check, front and back, with their phone and make their deposit electronically.
I do hope that this offers 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 little more to it than I might describe in just one little article but I believe you can get a good idea.