Differences between digital money, virtual currency and crypto-currencies

Every day, the number of people who play blackjack online or make purchases in an online store increases. Today, most of the traditional activities can be performed online and, in response to this need, the need to make transactions with money through the web arose.

Differences between digital money, virtual currency and crypto-currencies

Every day, the number of people who play blackjack online or make purchases in an online store increases. Today, most of the traditional activities can be performed online and, in response to this need, the need to make transactions with money through the web arose. Thus, appeared digital or electronic money, virtual currency and crypto currencies. Some people still do not know the differences between these three concepts and, in order to carry out successful operations online, there is nothing better than understanding what they are about.

Digital moneyAny

exchange of money through an electronic transaction involves digital money. This means that, when we make any transaction to send or receive money through the web, we are making use of this type of money. But we also use digital money when making a payment with a credit card, making a bank transfer or initiating a purchase or sale of foreign currency. Today, it is increasingly common for these types of transactions to be compared to those involving cash, which represents less than 10 percent of the money in circulation.

In this respect, Sweden is one of the countries that is on its way to becoming a cash-free society. When this goal is achieved, all transactions in that country will be in the form of digital money.

Virtual currencyThe

word "virtual" is defined as something that has an apparent existence but is not real. Therefore, virtual currency is not something that exists physically. This means that while they are within the world and digital money, in reality they have no physical form.

This is the case with some video games that use their own virtual currencies to acquire additional functions and resources within the game itself. This currency works only in the area for which it was designed and it is up to the issuing entity to establish its own value.

CryptcoinsCryptcoins

are part of the universe of virtual currencies but do not have a specific issuer. This is the case, for example, with Ethereum and Bitcoin.

Crypto-currencies, as they are also known, differ from other types of e-money in that they are not regulated by any entity and have what is known as cryptographic security. Cryptography is precisely what prevents the manipulation of this currency. As they are encrypted, it is impossible to trace them and therefore it is one of the payment methods chosen from the deep Internet. Crypto-currencies are a form of virtual currency which, in turn, belongs to the realm of digital money.

However, the three concepts are not interchangeable and understanding what each one is about will help to have a better understanding of the money that circulates today. E-money operates in any digital transaction, virtual currency is money that has no physical format and crypto-currencies are virtual currencies that are not regulated.