Binance Taipei

Binance Taipei

What Is Digital Currency-How Does It Work

 

What is digital currency? It is defined as: money saved and moved in digital form. Sounds simple enough, however how does it all work?

This type of currency is thought to be great to use for making purchases on the internet due to the fact that if it works the method it was meant to, transactions should be rather confidential and untraceable back to the payer or user.

This implies that hackers would no longer have the ability to collect individual info from individuals who use their credit cards to make online purchases. This would undoubtedly decrease the variety of taken identities that happen every day.

To help you understand more of, “what is digital currency?” I have done a fair bit of research on the subject and have discovered that there are several different types out there, each with it’s own unique qualities.

Here are simply 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 might possibly directly exchange it for solid gold bullion.

2. Central Currency Systems – these are like PayPal and these companies enable you to send out cash all over the world as long as you have money in the account. For some services supplied by these types of business, you get charged a fee on the receivers end of the deal.

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 cash to make your deal but your deal is non-refundable once made. This kind of system only operates in one instructions.

The E-cash concept has actually developed in addition to the evolution of the Web. People just do not feel comfortable with giving their personal credit card info over the Internet when making a purchase.

Too many bad things can happen like identity theft. No one desires their identity stolen.

So, many business have attempted to create this type of payment or monetary system to decrease the risks of shopping online.

Lots of nations have successfully produced 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 then all the cash is transferred into a bank. They can then use the card for anything they need to utilize it for.

Some nations are working on 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 customers 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 idea of what is digital currency and how it is attempting to take it’s location worldwide of e-commerce. There might be a little bit more to it than I might explain in just one small post but I think you can get a great concept.

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