What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: money kept and moved in digital kind. Sounds basic enough, however how does it all work?
This kind of currency is believed to be great to use for making purchases on the internet because if it works the way it was meant to, transactions must be rather confidential and untraceable back to the payer or user.
This implies that hackers would no longer be able to collect individual information from individuals who use their charge card to make online purchases. This would certainly reduce the number of stolen identities that happen 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 numerous different types out there, each with it’s own distinct qualities.
Here are just a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold stored in vaults. The gold offers an extra procedure of security and if you hold this type of currency, you might potentially directly exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these business allow you to send out cash all over the world as long as you have money in the account. For some services offered by these types of business, you get charged a fee on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based on cryptography and/or trust networks. Also 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 kind of system only operates in one direction.
The E-cash concept has progressed together with the evolution of the Internet. People simply do not feel comfortable with giving their personal credit card details online when buying.
Too many bad things can happen like identity theft. Nobody desires their identity taken.
Many business have tried to create this type of payment or monetary system to lessen the risks of shopping online.
Lots of countries have actually effectively produced 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 cash onto the card and then all the money is transferred into a bank. They can then utilize the card for anything they require to use it for.
Some countries are dealing with or have systems that permit the user to move money through mobile devices. I believe this is somewhat like what Chase lets their clients do. Their clients can take a picture of their check, front and back, with their phone and make their deposit digitally.
I do hope that this offers you some idea of what is digital currency and how it is attempting to take it’s location on the planet of e-commerce. There may be a bit more to it than I could explain in simply one little short article however I think you can get a good idea.