What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash saved and transferred in digital kind. Sounds basic enough, but how does it all work?
This type of currency is thought to be great to use for making purchases on the internet because if it works the way it was implied to, transactions need to be rather confidential and untraceable back to the payer or user.
This implies that hackers would no longer have the ability to collect personal info from people who utilize their charge card to make online purchases. This would clearly decrease the number of stolen 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 found that there are several various types out there, each with it’s own special qualities.
Here are just a couple of with their descriptions following:
1. Digital Gold Currency – This type is backed by gold kept in vaults. The gold supplies an extra step of security and if you hold this kind of currency, you might potentially directly exchange it for solid gold bullion.
2. Central Currency Systems – these resemble PayPal and these companies 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 kinds of business, 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. Also called Hard Electronic Currency, it is meant to be more like using money to make your transaction but your deal is non-refundable as soon as made. This kind of system only works in one direction.
The E-cash idea has actually evolved along with the development of the Web. Individuals simply do not feel comfortable with giving their individual credit card information online when purchasing.
Too many bad things can happen like identity theft. No one wants their identity stolen.
So, many companies have attempted to produce this kind of payment or monetary system to decrease the threats of shopping online.
Many countries have effectively developed systems for “in-house” use 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 cash is deposited into a bank. They can then utilize the card for anything they need to utilize it for.
Some nations are working on or have systems that enable the user to transfer cash through mobile phones. I believe this is somewhat like what Chase lets their customers do. Their customers can take a picture of their check, front and back, with their phone and make their deposit electronically.
I do hope that this offers 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 simply one small post however I think you can get an excellent concept.