Electronic Currency

Electronic currency is also known as electronic money, e-money, electronic cash, digital money, digital cash or digital currency. It refers to money or scrip which is exchanged only electronically. Typically, this involves the use of computer networks, the internet and digital stored value systems.
E-currency provides the Internet user with a safer and more convenient way in dealing with online transaction as they can make the payment by just a simply click on the confirm button and the deal is then completed. It minimizes the risk of using the credit card where the users’ personal financial information might be explored or being stolen.

Future evolution
The main focuses of electronic currency development are:
1) Being able to use it through a wider range of hardware such as secured credit cards; and
2) Linked bank accounts that would generally be used over an Internet means, for exchange with a secure micropayment system such as in large corporations (PayPal).

Furthering network evolution in terms of the use of digital cash, a company named DigiCash is at the focus of creating an e-cash system that would allow issuers to sell electronic coins at some value. When they are purchased they come under someone’s own name and are stored on his computer or under his online identity. At all times, the e-cash is linked to the e-cash company and all transactions go through it, so the e-cash company secures anything that is purchased. Only the company knows your information and will properly direct purchases to your location.

Drawback of electronic currency
Although digital cash can provide many benefits such as convenience and privacy, increased efficiency of transactions, lower transaction fees, and new business opportunities with the expansion of economic activities on the Internet, there are many potential issues with the use of digital cash. The transfer of digital currencies raises local issues such as how to levy taxes or the possible ease of money laundering. There are also potential macroeconomic effects such as exchange rate instabilities and shortage of money supplies (total amount of digital cash versus total amount of real cash available, basically the possibility that digital cash could exceed the real cash available). These issues may only be addressable by some type of cyberspace regulations or laws that regulate the transactions and watch for signs of trouble.