Unless you were living under a rock or in the Amazon jungle, you surely would have heard about the term Digital Currency. Today we are going to enlighten you about what Digital currency is, in a very simple and short way. Digital currency is similar to normal currency, at least in many ways. Yes you can buy normal stuff with digital currency, but it does have its limits.
Wikipedia defines digital currency as,
“Digital currency or digital money is an Internet-based medium of exchange distinct from physical (such as banknotes and coins) that exhibits properties similar to physical currencies, but allows for instantaneous transactions and borderless transfer-of-ownership.”
This basically means that digital currency is similar to conventional cash, except for the fact that you can transfer it immediately, without any card or books. Just with a mobile, laptop or computer, you will be able to buy, almost anything available on the internet.
Although response to digital currency was a mixed, more and more people are now opening up to it. There are a few well established digital currencies being used widely.
Some of famous Digital currencies are mentioned below:
Bitcoin: Founded by Satoshi Nakamoto, Bitcoin is the most widely used digital cash. It is also the most valuable, with current price of around 240$ in exchange of 1 Bitcoin. Bitcoin has also been in controversies since the beginning and has gathered some negative reviews, due to its recent lack of security. Almost 390m dollars were stolen in Japan’s MT Cox Bitcoin central, raising questions about its security. Still, Bitcoin is accepted in many online stores, including Amazon.
Litecoin: Similar to bitcoin, lite coin is also a cryptocurrency which is currently gaining ground. Litecoin was launched in the year 2011 by Charlie Lee, a MIT graduate and former Google engineer. Litecoin is used widely too and is seen as second-in-command to Bitcoin. Litecoin is based on an open source global payment network that is not governed by any central authority. Litecoins can be generated faster than bitcoins and has far better rewards per block.
Advantages And Disadvantages Of Digital Currency
Although it is nearly impossible that someday digital currency will replace conventional currency, the rate at which use of digital currency is growing is phenomenal. Most of these digital currencies are international and are transferred on peer to peer basis. This makes it a lot secure, as you will need exact address for the transfer to happen, thus reducing chances of stealing. Unlike credit or debit card, which charge almost 5% of transaction, digital currency transfers cost are almost negligible, making them much preferable.
Although limitless possibilities that come along with digital currency, it has not been accepted by society or the government of various countries. Currently there are 60,000 to 70,000 Bitcoin transactions each day, which is negligible to transactions with real currency. When exchanges get robbed, the real losers are the users. Lack of security is one of the major concern when it comes to exchange centers.
In general opinion, digital currency will take some time to spread among the masses, but is something you should know about. Digital currency definitely seems to spreading and once the faults are eliminated, it will sure gain some traction.