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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 type. Sounds basic enough, but how does it all work?
This kind of currency is thought to be great to use for making purchases on the internet since if it works the method it was suggested to, transactions should be rather confidential and untraceable back to the payer or user.
This implies that hackers would no longer be able to collect personal info from individuals who use their charge card to make online purchases. This would clearly reduce the number of stolen identities that occur every day.
To help you understand more of, “what is digital currency?” I have done a fair 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 special qualities.
Here are just a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold kept in vaults. The gold provides an extra measure of security and if you hold this type of currency, you might perhaps directly exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these business permit you to send money all over the world as long as you have cash in the account. For some services supplied by these kinds of companies, you get charged a cost on the receivers end of the deal.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Called Hard Electronic Currency, it is meant to be more like utilizing money to make your transaction but your transaction is non-refundable as soon as made. This type of system only operates in one direction.
The E-cash idea has progressed along with the development of the Web. Individuals just do not feel comfortable with providing their individual charge card info over the Internet when buying.
A lot of bad things can happen like identity theft. Nobody wants their identity stolen.
So, lots of companies have tried to create this kind of payment or monetary system to reduce the risks of shopping online.
Many countries have actually successfully produced systems for “in-house” 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 money is deposited into a bank. They can then utilize the card for anything they need to use it for.
Some countries are working on or have systems that allow the user to move cash through mobile devices. 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 electronically.
I do hope that this provides you some idea of what is digital currency and how it is attempting to take it’s place worldwide of e-commerce. There might be a bit more to it than I could explain in just one little article however I believe you can get a great concept.