The money will always be an important factor to the present, and future generation of the mankind. The money as we have seen before has been in its physical form, like the banknotes, coins etc. The transaction of cash from one account to another account, or from one bank to the other bank, used to be a lengthy procedure. It can also be laborious if the transaction has to be done internationally. People wasted a lot of time in the lengthy queues at banks to get minimal work done. To make the life of a person trouble-free, the concept of “digital currency” came into existence.
What is electronic money?
This is the virtual version of physical currencies which still exist today. It holds the same value and exhibits the same property as the current money in the market. The transaction done through digital currencies are instantaneous. The status of the cash present in your account can be done through an app, or via a text message. The money present in the electronic form can be converted into a physical by withdrawing it through an Automated Teller Machine(ATM).
The physical money can be converted back to digital currencies by depositing it in the bank. The digital currency allows you to purchase products online, groceries at the stores, pay the bills for electricity, water, and even at the restaurants. The card-like credit cards or debit cards can be used to do the transaction.
Terms related to electronic money.
1) Cryptocurrency
The techniques of cryptography are used in cryptocurrency to verify the transactions, or funds, it is also used for the creation of transaction units of currency. The mode of operation is independent of a central body or an individual, known has decentralization. The software is used to supply the money under the agreement of the users of the system. The transactions are unidirectional, and cannot be bi-directional. There is no middleman involved in the transaction, this is made from individual to individual. The durability is very high regarding the online transaction. The process employed in digital currency transfer is accepted globally. It promises to be highly secure. It is very fast, and cheap. It is user-friendly. The Government has no authority over the cryptocurrency. It also promises to provide privacy for the user with the good amount of security.
2) Bitcoin
It is a form of cryptocurrency which is globally accepted method of payment. It employs all the characteristics of cryptocurrency. Many leading entrepreneurs are carrying out their business on bitcoins. The peer-to-peer identity can be anonymous or known. The option to be anonymous or not is user-defined. The bitcoins can be exchanged for other products, currencies, or even services. There is public ledger known as “BLOCK CHAIN”, which keeps a record of all the transactions done with bitcoins. The transfer of money is completely transparent, its open to the public as it is saved in a blockchain. No one can steal your payment information.
