a.k.a. e-currency, electronic cash, electronic money, digital money, digital cash or digital currency.
as we can see directly in its name, is actually currency or money used on the internet related field.
E-currency are often used in online trading and investing which involves use of computer networks, the internet and digital stored value systems.
E-currency provides a new payment method on the internet so as avoid using credit card, whereby users risk exposing their credit card information to unknown merchants.
Technically, e-currency is a representation, or a system of debits and credits used to exchange value, within another system or itself as a stand alone system, online or offline.
There are two major types of e-currency in the world. The major different is their backed base.
- One is backed by precious metal, is backed by gold. Digital Gold Currencies (DGCs), such as e-gold or c-gold, is a form of Internet money denominated in gold weight.
- Another type of e-currency is Digital Currency backed by hard currency such as Paypal, NetPay and StormPay in the form of USD and EURO. Another popular form of e-currency sell through third party digital currency exchange, such as London Gold Exchange, is Liberty Reserve.
How e-currency works
An individual opens an account with an online e-currency company and “deposits” money in the account. The e-currency company then converts the account holders’ deposits into gold or silver bullion, or whatever e-currency used, stored in the bank. Via the Internet, the account holder can transfer ownership the e-gold or other e-currency into someone else’s e-currency account or used for online trading.