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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash stored and transferred in digital kind. Sounds basic enough, however how does it all work?
This type of currency is believed to be great to use for making purchases on the internet due to the fact that if it works the way it was indicated to, transactions must be rather anonymous and untraceable back to the payer or user.
This indicates that hackers would no longer be able to collect personal information from individuals who use their credit cards to make online purchases. This would undoubtedly reduce the number of stolen identities that happen every day.
To help you comprehend 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 special 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 provides an extra step of security and if you hold this type of currency, you could potentially straight exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these companies enable you to send out 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 cost on the receivers end of the deal.
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 deal but your deal is non-refundable when made. This type of system just works in one instructions.
The E-cash concept has actually developed together with the development of the Web. People simply do not feel comfy with offering their personal credit card details over the Internet when making a purchase.
A lot of bad things can take place like identity theft. No one desires their identity stolen.
So, lots of companies have tried to develop this type of payment or monetary system to decrease the threats of shopping online.
Numerous nations have actually successfully created 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 after that all the money is transferred into a bank. They can then use the card for anything they need to utilize it for.
Some countries are dealing with or have systems that enable the user to move money through mobile devices. I think this is somewhat like what Chase lets their customers do. Their consumers can take a photo of their check, front and back, with their phone and make their deposit digitally.
I do hope that this provides 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 might be a little bit more to it than I could describe in just one small article but I think you can get an excellent idea.