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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money stored and moved in digital kind. Sounds simple enough, but how does it all work?
This type of currency is believed to be excellent to use for making purchases on the internet due to the fact that if it works the method it was suggested to, deals ought to be rather anonymous and untraceable back to the payer or user.
This means that hackers would no longer have the ability to gather individual info from people who use their credit cards to make online purchases. This would obviously reduce the number of stolen identities that occur every day.
To help you understand more of, “what is digital currency?” I have done quite a bit of research on the subject and have discovered that there are several various types out there, each with it’s own unique qualities.
Here are simply a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold saved in vaults. The gold supplies an extra measure of security and if you hold this kind of currency, you could perhaps straight exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these business enable you to send cash all over the world as long as you have cash in the account. For some services offered by these kinds of companies, you get charged a cost on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Called Hard Electronic Currency, it is meant to be more like using money to make your transaction but your transaction is non-refundable when made. This type of system just works in one direction.
The E-cash concept has actually developed in addition to the evolution of the Internet. People just do not feel comfy with giving their personal credit card details online when purchasing.
Too many bad things can occur like identity theft. No one desires their identity taken.
Lots of business have actually tried to create this type of payment or monetary system to reduce the dangers of shopping online.
Numerous countries have actually effectively developed systems for “internal” use such as Hong Kong’s Octopus card. This card works much like 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 utilize the card for anything they require to utilize it for.
Some nations are dealing with or have systems that permit the user to move money through mobile phones. I think this is rather like what Chase lets their clients do. Their customers can take a picture 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 place on the planet of e-commerce. There may be a little more to it than I could explain in just one small post but I think you can get a good idea.