ELECTRONIC MONEY AND CRYPTOCURRENCY
In the future, money may not be metal or paper. The coming world of virtual money is something to be understood by all of us. Currency can be exchanged electronically using debit and credit cards using electric fund transfer at point of sale.
A good example of electronic money is an online back account. I can pay bills, buy consumer goods, transfer money between my accounts at my bank or to transfer to third parties, like my children, who have different banks than mine, by use of electronic entries on my computer. A convenience that comes in handy around birthdays. No checks or cash are involved.
There are companies apart from banks that specialize in worldwide online payments systems that support online money transfers and serve as electronic alternatives to traditional paper methods like checks and money orders. Such services allow for sending or receiving personal payments for shared expenses such as splitting of dinner bills or rental charges….
Now enter cryptocurrency. It is made of the promise of value not from the government but only the people who use it essentially from computer to computer. The promise to pay exists outside of the traditional system and is therefore, for now anyway, virtually unregulated. Cryptocurrency is based on the principles of the distributed ledger and the block chain. A peer-to-peer network is required as well as consensus algorithms to ensure replication across nodes is undertaken.