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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: cash stored and moved in digital type. Sounds simple enough, but how does it all work?
This kind of currency is thought to be good to utilize for making purchases on the internet due to the fact that if it works the way it was indicated to, transactions should be rather anonymous and untraceable back to the payer or user.
This implies that hackers would no longer be able to collect individual information from people who utilize their charge card to make online purchases. This would obviously decrease the number of taken 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 actually discovered that there are a number of different types out there, each with it’s own distinct qualities.
Here are simply a few with their descriptions following:
1. Digital Gold Currency – This type is backed by gold saved in vaults. The gold supplies an additional procedure of security and if you hold this type of currency, you might perhaps straight exchange it for solid gold bullion.
2. Centralized Currency Systems – these resemble PayPal and these companies allow you to send money all over the world as long as you have money in the account. For some services provided 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 upon cryptography and/or trust networks. Called Hard Electronic Currency, it is intended to be more like using money to make your deal but your deal is non-refundable as soon as made. This type of system only works in one direction.
The E-cash concept has developed along with the evolution of the Internet. People just do not feel comfy with giving their personal charge card information over the Internet when buying.
A lot of bad things can take place like identity theft. Nobody wants their identity stolen.
Many companies have tried to develop this type of payment or monetary system to decrease the risks of shopping online.
Numerous nations have effectively developed systems for “internal” usage such as Hong Kong’s Octopus card. This card works similar to a sort of debit card where the user loads cash onto the card and then all the cash is transferred into a bank. They can then utilize the card for anything they need to use it for.
Some countries are dealing with or have systems that allow the user to move cash through mobile phones. I believe this is somewhat like what Chase lets their consumers do. Their consumers 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 concept of what is digital currency and how it is trying to take it’s location worldwide of e-commerce. There may be a little bit more to it than I could describe in simply one little post however I think you can get a good idea.