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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: cash saved and transferred in digital form. Sounds easy enough, but how does it all work?
This type of currency is believed to be excellent to use for making purchases on the internet because if it works the method it was indicated to, deals must be rather anonymous and untraceable back to the payer or user.
This suggests that hackers would no longer be able to collect personal info from individuals who utilize their charge card to make online purchases. This would clearly decrease the number of stolen identities that take place every day.
To help you understand more of, “what is digital currency?” I have actually done quite a bit of research on the subject and have actually discovered that there are a number of various 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 extra procedure of security and if you hold this type of currency, you could potentially directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these companies permit 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 charge on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Called Hard Electronic Currency, it is planned to be more like utilizing money to make your transaction however your deal is non-refundable as soon as made. This type of system only operates in one direction.
The E-cash idea has actually evolved together with the development of the Web. Individuals simply do not feel comfortable with providing their personal charge card information over the Internet when making a purchase.
Too many bad things can occur like identity theft. No one desires their identity taken.
Numerous companies have attempted to produce this type of payment or monetary system to reduce the dangers of shopping online.
Lots of 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 cash onto the card and then all the money is transferred into a bank. They can then utilize the card for anything they require to utilize it for.
Some countries are dealing with or have systems that enable the user to move cash through mobile phones. I believe 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 gives you some idea of what is digital currency and how it is attempting to take it’s location on the planet of e-commerce. There may be a bit more to it than I could explain in simply one small article but I think you can get a good concept.