Electronic money (or digital money) refers to cash and transactions using electronic means, encompassing the use of computer networks (such as the Internet) and digital stored value systems. Electronic Funds Transfer (EFT) is an example of electronic money. It is also a collective term for financial cryptography technologies enabling it.
While this has been an interesting problem for cryptography (see, for example, David Chaum's work), the use of digital cash so far has been relatively low. One rare success has been Hong Kong's Octopus card system, which started as a transit payment system and has grown into a widely used electronic cash system.
Electronic Money and currency
Technically, electronic money can be an independent currency, just like Euro before the legal tender of Euro was introduced in 2002. However, a service provider (except banks or governments) of electronic money lacks the abilities to back the money with commodities and to persuade people to have faith in their currency and make people use electronic money like central banks or governments do (see fiat money). More commonly the electronic money is used as a non-physical form of another currency.
In the case of Octopus Card in Hong Kong, deposits work similar to banks. After Octopus Card Limited receives money for deposit from users, the money is deposited into banks, which is similiar to debit-card issuing banks redepositing money at central banks.
The main focus of digital cash is being able to expend it through many means such as secured credit cards, linked bank accounts that would be generally used over an internet-means of exchange to a secure micropayment system such as in large corporations (PayPal).
Future evolvements of networking in terms using digital cash, a company named DigiCash is on the focus of creating an e-cash system that would allow an e-cash issuer to purchase electronic coins at some value.
When spending this cash, since it is linked to the e-cash company, it secures anything that is purchased in terms that it goes through the issuer at all times, therefore only the company knows your information, and will properly direct purchases to your location.
An electronic payment protocol is a series of transactions, at the end of which a payment has been made, using a token issued by a third party.
Finally, electroniccash paves the way for new versions of old crimes such as kidnapping and flmail (see [13]) where money drops can now be carried out safely from the criminal's home computer.
Token forgery can be prevented in an electroniccash system as long as the cryptography is sound and securely implemented, the secret keys used to sign coins are not compromised, and integrity is maintained on the public keys.
Feeds |
Contact