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What Is Digital Currency-How Does It Work
What is digital currency? It is defined as: cash stored and transferred in digital form. Sounds easy enough, however how does it all work?
This type of currency is believed to be good to utilize for making purchases on the internet because if it works the way it was suggested to, deals should be rather confidential and untraceable back to the payer or user.
This means that hackers would no longer be able to gather personal details from people who utilize their credit cards to make online purchases. This would clearly decrease the variety of stolen identities that happen every day.
To assist you comprehend more of, “what is digital currency?” I have done quite a bit of research study on the subject and have actually found that there are a number of 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 kept in vaults. The gold supplies an additional measure of security and if you hold this type of currency, you could perhaps directly exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these business enable you to send out cash all over the world as long as you have cash in the account. For some services provided by these types of companies, you get charged a charge on the receivers end of the transaction.
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 using cash to make your deal however your transaction is non-refundable once made. This type of system just works in one direction.
The E-cash concept has progressed together with the development of the Internet. Individuals simply do not feel comfy with giving their personal credit card information online when purchasing.
A lot of bad things can take place like identity theft. Nobody desires their identity taken.
Many companies have tried to create this type of payment or monetary system to lessen the dangers of shopping online.
Lots of nations have successfully developed systems for “in-house” usage such as Hong Kong’s Octopus card. This card works just like 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 require to utilize it for.
Some countries are working on or have systems that permit the user to transfer cash through mobile phones. I believe this is somewhat like what Chase lets their consumers do. Their consumers 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 concept of what is digital currency and how it is trying to take it’s place on the planet of e-commerce. There may be a little bit more to it than I could describe in just one little post but I think you can get a great concept.