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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: cash saved and moved in digital form. Sounds basic enough, however how does it all work?
This type of currency is thought to be excellent to utilize for making purchases on the internet since if it works the method it was meant to, transactions must be rather anonymous and untraceable back to the payer or user.
This implies that hackers would no longer be able to gather personal info from individuals who utilize their charge card to make online purchases. This would obviously decrease the variety of stolen identities that happen 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 actually discovered that there are a number of various types out there, each with it’s own special 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. Centralized Currency Systems – these resemble PayPal and these companies enable you to send cash all over the world as long as you have cash in the account. For some services provided by these kinds of companies, you get charged a charge on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Also called Hard Electronic Currency, it is planned to be more like utilizing cash to make your deal but your deal is non-refundable when made. This type of system only works in one direction.
The E-cash concept has progressed along with the evolution of the Internet. People simply do not feel comfortable with giving their personal charge card information over the Internet when making a purchase.
Too many bad things can take place like identity theft. Nobody desires their identity taken.
Many business have attempted to create this type of payment or financial system to reduce the risks of shopping online.
Numerous nations have actually successfully created systems for “in-house” use 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 money is transferred into a bank. They can then utilize the card for anything they need to use it for.
Some nations are dealing with or have systems that allow the user to transfer money through mobile devices. I believe this is somewhat like what Chase lets their clients do. Their clients can take a photo of their check, front and back, with their phone and make their deposit electronically.
I do hope that this gives you some idea of what is digital currency and how it is trying to take it’s location on the planet of e-commerce. There may be a little bit more to it than I might explain in just one small post however I think you can get a good idea.