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What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: cash kept and transferred in digital form. Sounds simple enough, however how does it all work?
This kind of currency is believed to be good to utilize for making purchases on the internet because if it works the way it was meant to, deals need to be rather confidential and untraceable back to the payer or user.
This indicates that hackers would no longer have the ability to collect personal info from individuals who utilize their charge card to make online purchases. This would undoubtedly reduce the variety of taken identities that occur every day.
To assist you understand more of, “what is digital currency?” I have done a fair bit of research on the subject and have found that there are several different types out there, each with it’s own unique 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 measure of security and if you hold this kind of currency, you could potentially straight exchange it for solid gold bullion.
2. Centralized Currency Systems – these are like PayPal and these companies allow you to send cash all over the world as long as you have cash in the account. For some services offered by these types of business, you get charged a cost 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 planned to be more like using cash to make your deal however your deal is non-refundable as soon as made. This kind of system only works in one direction.
The E-cash concept has developed together with the development of the Internet. Individuals just do not feel comfortable with offering their individual credit card details online when purchasing.
A lot of bad things can take place like identity theft. Nobody wants their identity taken.
Many business have tried to produce this type of payment or financial system to minimize the risks of shopping online.
Numerous nations have actually successfully produced systems for “internal” 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 money is deposited 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 allow the user to move cash through mobile phones. I believe this is somewhat like what Chase lets their clients do. Their consumers can take a picture 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 location in the world of e-commerce. There may be a bit more to it than I could describe in just one little article however I believe you can get a good idea.