The currency refers to electronic currencies stored electronically in banks and is one of three forms of electronic money. Although paper money is still used worldwide, up to 80% of the world’s currency is stored electronically in banks. Since childhood, it has evolved from an alternative to doing business into a major form of e-commerce and seems to be continuing to evolve.
The first digital currency was created during the first dot-com bubble in the early 2000s. It was called E-Gold and was founded in 1996 by Gold and Sliver Reserve Inc, allowing users to transfer small amounts of Golden electronically. In the spring of 2000, they became the first electronic money to offer exchange services for other currencies.
It was launched two years before PayPal and had more than a million accounts in 2004. Another service launched in 2006, Liberty Reserve, allowed its customers to convert euros or dollars into Liberty Reserve cash, and then vice versa. Unfortunately, shortly thereafter, the U.S. government reported that the perpetrators had used these websites and that they were both closed.
The difference between virtual, digital and cryptocurrency
As more and more banks are promoting an increase in the number of electronic banking services, virtual currencies function as an independent currency, the value of which is created by the original financier. However, the world’s most famous virtual currency, Bitcoin, does not meet this specification, but includes aspects of all three forms of electronic money.
The digital currency differs from it as money secured by an asset that is worth a fair share of its value. Since most of the world’s money is stored in bank computers, it can be said that most of the world’s currency is now digital.
Cryptocurrencies refer to forms of electronic money whose transitions are encrypted. Using blockchains to store data effectively binds them together and acts as registers that users can use to maintain a consistent data record. Because of the variety of ways to influence the price, its cost often fluctuates. Although cryptocurrencies have a certain degree of anonymity, by law some of them are still required to disclose the identity of their users.
The future of transactions
As more and more banks turn to digital currencies as the main form of electronic accounting, as well as to the growing emergence of a wide range of virtual and cryptocurrencies, we can say that the future of global transactions will be determined by electronic means. Perhaps in a hundred years paper money may be a thing of the past.