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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money kept and moved in digital type. Sounds simple enough, but how does it all work?
This kind of currency is believed to be great to use for making purchases on the internet since if it works the way it was indicated to, deals should be rather anonymous and untraceable back to the payer or user.
This indicates that hackers would no longer be able to collect personal information from individuals who use their credit cards to make online purchases. This would undoubtedly decrease the number of stolen identities that happen every day.
To help you understand more of, “what is digital currency?” I have actually done quite a bit of research study on the subject and have found that there are a number of different 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 additional step of security and if you hold this type of currency, you might potentially directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these resemble PayPal and these companies allow you to send out money all over the world as long as you have money in the account. For some services offered by these types of companies, you get charged a fee on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Likewise called Hard Electronic Currency, it is meant to be more like using money to make your deal but your transaction is non-refundable as soon as made. This kind of system only works in one instructions.
The E-cash idea has progressed in addition to the advancement of the Internet. People just do not feel comfortable with giving their individual charge card info over the Internet when making a purchase.
Too many bad things can happen like identity theft. Nobody desires their identity taken.
So, many companies have tried to develop this type of payment or monetary system to reduce the threats of shopping online.
Lots of nations have actually effectively created 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 after that all the cash is transferred into a bank. They can then use the card for anything they need to use it for.
Some countries are working on or have systems that enable the user to move money through mobile phones. I believe this is somewhat like what Chase lets their customers do. Their consumers can take an image of their check, front and back, with their phone and make their deposit digitally.
I do hope that this provides you some concept of what is digital currency and how it is trying to take it’s place on the planet of e-commerce. There may be a bit more to it than I could describe in just one little short article however I believe you can get a great idea.