Currency refers to electronic currencies stored electronically in banks and is one of the three forms of electronic currency. While paper money is still used worldwide, up to 80% of the world’s currency is stored by banks electronically. From an early age, it has grown from an alternative to running a business to a basic form of e-commerce and seems to only continue to grow.
The first digital currency was created during the first internet bubble in the early 2000s. It is named E-Gold and was founded in 1996 by Gold & Sliver Reserve Inc, which allows consumers to transfer small amounts of gold values electronically. In the spring of 2000, it became the first electronic currency to offer an exchange service for other currencies.
Launched two years before PayPal, by 2004 it had over one million accounts. Another service, starting in 2006, Liberty Reserve, allowed its customers to convert euros or dollars into Liberty Reserve money and then return again. Unfortunately, it was soon revealed by the US government that the criminals used these websites and both were imprisoned.
The difference between virtual, digital and cryptocurrencies
While more and more banks are allowing an increase in e-banking, virtual currencies function as independent money, the value of which is created by their original backer. However, the world’s most famous virtual currency, Bitcoin, does not meet this specification, but covers aspects of all three forms of e-currency.
The digital currency differs from that as money backed by an asset that is worth the real equivalent of value. Because most of the world’s money is stored in bank computers, it can be said that most of the world’s currency is already digital.
Cryptocurrencies refer to forms of electronic money whose transitions are encrypted. Using blockchains to store data, they effectively connect together and act as ledgers that users can use to keep track of data. Due to the variety of ways in which its price can be made, it often varies in value. Although cryptocurrencies carry a degree of anonymity, some are still required by law to disclose the identities of their users.
The future of transactions
As more and more banks turn to digital currencies as the main form of electronic record keeping and the growing emergence of a wide variety of virtual and cryptocurrencies, it can be said that the future of global transactions will be set to be done electronically. In maybe a hundred years, paper money could remain in practice.