What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash stored and moved in digital type. Sounds easy enough, however how does it all work?
This type of currency is thought to be great to use for making purchases on the internet due to the fact that if it works the method it was meant to, transactions should be rather confidential and untraceable back to the payer or user.
This implies that hackers would no longer have the ability to gather personal info from people who utilize their credit cards to make online purchases. This would clearly reduce the variety of taken identities that happen 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 actually found that there are numerous different types out there, each with it’s own distinct 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 offers an extra step of security and if you hold this kind of currency, you might possibly directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these business 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 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 planned to be more like using money to make your transaction however your transaction is non-refundable as soon as made. This kind of system just operates in one instructions.
The E-cash concept has actually evolved in addition to the evolution of the Internet. People simply do not feel comfortable with giving their individual credit card information over the Internet when making a purchase.
Too many bad things can take place like identity theft. No one wants their identity taken.
So, lots of companies have actually tried to produce this type of payment or monetary system to decrease the threats of shopping online.
Many countries have successfully developed systems for “in-house” usage 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 then all the money is transferred into a bank. They can then utilize the card for anything they need to utilize it for.
Some countries are working on or have systems that permit the user to transfer money through mobile phones. I think this is rather like what Chase lets their consumers do. Their customers 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 location on the planet of e-commerce. There may be a bit more to it than I might describe in just one small post however I believe you can get a great idea.