What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money stored and transferred in digital type. Sounds simple enough, however how does it all work?
This type of currency is believed to be good to use for making purchases on the internet since if it works the method it was implied to, transactions must be rather confidential and untraceable back to the payer or user.
This indicates that hackers would no longer be able to collect personal details from individuals who use their credit cards to make online purchases. This would undoubtedly decrease the variety of stolen identities that take place every day.
To assist you comprehend more of, “what is digital currency?” I have done a fair bit of research on the subject and have found that there are several 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 stored in vaults. The gold provides an additional step of security and if you hold this kind of currency, you might perhaps directly exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these business allow you to send money all over the world as long as you have cash 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. Called Hard Electronic Currency, it is intended to be more like utilizing money to make your deal but your deal is non-refundable as soon as made. This type of system just operates in one direction.
The E-cash idea has progressed along with the advancement of the Internet. Individuals simply do not feel comfy with giving their individual credit card information over the Internet when making a purchase.
Too many bad things can occur like identity theft. No one wants their identity stolen.
So, numerous business have actually tried to create this type of payment or monetary system to decrease the risks of shopping online.
Lots of countries have effectively created 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 cash 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 utilize it for.
Some countries are working on or have systems that permit the user to move money through mobile phones. I believe this is rather like what Chase lets their consumers do. Their customers can take a photo of their check, front and back, with their phone and make their deposit digitally.
I do hope that this gives you some idea of what is digital currency and how it is trying to take it’s place in the world of e-commerce. There may be a little more to it than I could explain in just one small post however I think you can get a great idea.