Sunday, February 15, 2009

Electronic Currency

Electronic currency refers to money or scrip which is exchanged through electronically. Electronic currency involves in use of computer networks, the internet and digital stored value systems. The examples of electronic currency are Electronic Funds Transfer (EFT). Electronic funds transfer (EFT) refers to the computer-based systems used to perform financial transactions electronically.

A private currency may use gold to provide extra security, such as digital gold currency. An e-currency system may be fully backed by gold (like e-gold and c-gold), non-gold backed, or both gold and non-gold backed (like e-bullion and Liberty Reserve). Also, some private organizations, such as the US military use private currencies such as Eagle Cash. Many systems will sell their electronic currency directly to the end user, such as Paypal and WebMoney, but other systems, such as e-gold, sell only through third party digital currency exchangers. In the case of Octopus Card in Hong Kong, deposits work similarly to banks'. After Octopus Card Limited receives money for deposit from users, the money is deposited into banks, which is similar to debit-card-issuing banks redepositing money at central banks.

Electronic currency means the money you use over the internet. Electronic currency allows its holder to buy the goods and the services that the vastness of the internet offers. Electronic currency trading, therefore, means buying and selling of this internet money. Just like in normal everyday monetary currencies, electronic currencies are also varied. Each one of them is backed by an underlying monetary currency or in some cases, even valuable or precious metals. One profits by trading on these electronic currencies. It’s much more complicated than that of course but I’m sure you know what I’m talking about.

Benefits of Electronic currency:

1.) Electronic currency trading allows you to do business and earn with only a few dollars of investment. Electronic currency trading does not demand much and it is really up to you if you want to increase your investment or not. With electronic currency trading you are given many opportunities to profit without spending too much on investment.

2.) Electronic currency trading has a low transaction cost. Unlike other businesses that eat up your profit with exorbitant fees, electronic currency trading allows you to do business with minimal fees giving you more profit and more money for you.

3.) Electronic currency trading is versatility and convenience to the persons involved. You can work with any electronic currency trading market that best suits your needs for any time of day. The electronic currency trading business does not sleep so night or day, the world is merely at your fingertips.

Disadvantages of Electronic currency:

1.) Fraud over electronic currency trading has been a pressing issue in recent years. Hacking into bank accounts and illegal retrieval of banking records has led to a widespread invasion of privacy and has promoted identity theft.

2.)There is also a pressing issue regarding the technology involved in electronic currency trading. Power failures, loss of records and undependable software often cause a major setback in promoting technology.

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