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The world of crypto-currency can scare the world of cryptocurrency because of its complex terminology, but it got even more confusing when JPMorgan announced last week the launch of its own coin, which many claimed was a digital currency – possibly one stable coin ̵ 1; but definitely not a cryptocurrency.
In this sense, Hard Fork has compiled a summary of the differences between cryptocurrencies, digital currencies and virtual currencies – three terms that are often used indiscriminately but do not mean the same. Definition of Digital Currencies
Digital currency is the general term used to describe all electronic money that includes both the virtual currency and the cryptocurrency. It can be regulated or not regulated.
It is only available in digital or electronic form, and unlike a dollar bill or a coin, it is not tangible.
Digital currencies, which can only be owned and distributed through electronic purses or fixed linked networks, are commonly referred to as digital money or cyber cash.
The absence of intermediaries means that transactions are usually instantaneous and incur little or no fees.
[19659006] For example, if what critics say is true, JPMorgan’s coin would be considered a digital currency because it does not qualify for a blockchain, it will be used online and it intends to transfer money between the financial corporation and its clients. What about virtual currencies?
Virtual currencies are a type of digital currency that typically controlled by its creators and used and accepted among members of a particular virtual community
becomes somewhat confusing: all virtual currencies are digital ( they only exist online), but not . All digital currencies are virtual because they exist outside of a specific virtual environment
The virtual currency is essentially a representation of the monetary value issued and managed by private issuers for the transaction of peer-to-peer payments is controlled. They are some times represented in the form of tokens and can not be regulated without legal tender such as coins or banknotes.
Unlike the fiat currency, the virtual currency is not issued by a bank. Due to this lack of regulation, virtual currencies are vulnerable to price fluctuations.
Cryptocurrencies such as Bitcoin and Ethereum are considered virtual currencies. What is a Cryptocurrency
The term “crypto” in “cryptocurrency” refers to the fact that many cryptographic algorithms and cryptographic methods are used to ensure security throughout the network. This level of security also makes it difficult to fake cryptocurrencies.
Many cryptocurrencies function as block-based distributed systems without the need for a trusted third party such as a central bank or credit card company.
In this case, peer-to-peer transfers are facilitated by the use of private and public keys.
Bitcoin is undoubtedly the best known and most widely used blockchain-based cryptocurrency.
It is also the most valuable, currently at $ 3,819 per coin.
Although Bitcoin is the most popular, it is not the only cryptocurrency. There are many alternatives or old coins like Litecoin and Monero. Some of these imitations mimic bitcoin, while others are forks or simply new cryptocurrencies that have separated or been detached from an already existing one.
Due to their virtual nature, cryptocurrencies do not have a central repository, which means that they can be wiped out by a computer crash if there is no backup copy of the assets or if the user relocates his private key.
Unlike cash, which is completely anonymous, transactions executed with cryptocurrencies can be tracked in the case of Bitcoin in the blockchain without initially knowing the identity of the participants.
However, it should be noted that some cryptocurrencies are less private than others. For example, Dash, ZCash and Monero are far harder to track than Bitcoin.
Cryptocurrencies are typically characterized by price volatility, as their value is based solely on supply and demand. Summary of Results
In summary, d digital currency is the general term for money that exists only in digital space. Virtual currencies and cryptocurrencies are digital currencies because they exist online.
Virtual currency is a form of digital currency that is available in the virtual world (think exclusive online communities created by developers.
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Cryptocurrencies are digital currencies because you are online, but they are also virtual currencies created using cryptographic algorithms.
Although the terms digital, virtual, and cryptocurrency are often cobbled together, it is important to understand the nuances between the three. Use it wisely! Published 19 February 2019 – 09:14 UTC.
