What Is Digital Currency-How Does It Work
What is digital currency? It is specified as: money kept and moved in digital type. Sounds easy 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 indicated to, transactions should 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 people who utilize their charge card to make online purchases. This would undoubtedly reduce the number of taken identities that happen every day.
To assist you comprehend more of, “what is digital currency?” I have done a fair bit of research on the subject and have discovered that there are a number of 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 kept in vaults. The gold supplies an additional measure of security and if you hold this kind of currency, you could perhaps directly exchange it for solid gold bullion.
2. Central Currency Systems – these are like PayPal and these companies allow you to send out money all over the world as long as you have cash in the account. For some services supplied by these types of companies, you get charged a fee on the receivers end of the transaction.
3. Decentralized Currency Systems – Like Bitcoin are all based upon cryptography and/or trust networks. Also called Hard Electronic Currency, it is planned to be more like utilizing cash to make your deal but your deal is non-refundable once made. This kind of system just works in one direction.
The E-cash idea has actually developed together with the advancement of the Web. Individuals simply do not feel comfortable with providing their individual charge card info over the Internet when buying.
A lot of bad things can take place like identity theft. Nobody desires their identity taken.
Many business have attempted to develop this type of payment or financial system to reduce the risks of shopping online.
Lots of nations have successfully developed 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 money 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 nations are dealing with or have systems that enable the user to move money through mobile phones. I think this is rather like what Chase lets their customers do. Their clients can take an image of their check, front and back, with their phone and make their deposit digitally.
I do hope that this gives you some idea of what is digital currency and how it is trying to take it’s place worldwide of e-commerce. There might be a little bit more to it than I could explain in just one small article however I believe you can get a good concept.