Digital currency

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In July 2014, theNew York State Department of Financial Servicesproposed the most comprehensive regulation of virtual currencies to date, commonly calledBitLicense.[35]Unlike the US federal regulators it has gathered input from bitcoin supporters and the financial industry through public hearings and a comment period until 21 October 2014 to customize the rules. The proposal per NY DFS press release sought to strike an appropriate balance that helps protect consumers and root out illegal activity.[36]It has been criticized by smaller companies to favor established institutions, and Chinese bitcoin exchanges have complained that the rules are overly broad in its application outside the United States.[37]

Origins of digital currencies date back to the 1990sDot-com bubble. One of the first wasE-gold, founded in 1996 and backed by gold. Another known digital currency service wasLiberty Reserve, founded in 2006; it let users convert dollars or euros to Liberty Reserve Dollars or Euros, and exchange them freely with one another at a 1% fee. Both services were centralized, reputed to be used for money laundering, and inevitably shut down by the U.S. government.[11]Q coins or QQ coins, were used as a type of commodity-based digital currency onTencent QQs messaging platform and emerged in early 2005. Q coins were so effective in China that they were said to have had a destabilizing effect on the Chinese Yuan currency due to speculation.[12]Recent interest incryptocurrencieshas prompted renewed interest in digital currencies, withbitcoin, introduced in 2008, becoming the most widely used and accepted digital currency.

German Central Bank testing blockchain technology. Brave New Coin. 2016-12-01

History of Mobile & Contactless Payment Systems.

Black Market Bank Accused of Laundering $6B in Criminal Proceeds.

On September 9, 2014,Apple Paywas announced at theiPhone 6event. In October 2014 it was released as an update to work oniPhone 6andApple Watch. It is very similar toGoogle Wallet, but for Apple devices only.

Government-controlledSberbank of RussiaownsYandex.Money electronic payment service and digital currency of the same name.[55]Russias President Vladimir Putin has signed off on regulation of ICOs and cryptocurrency mining by July 2018.[56]

A law passed by theNational Assembly of Ecuadorgives the government permission to make payments in electronic currency and proposes the creation of a national digital currency. Electronic money will stimulate the economy; it will be possible to attract more Ecuadorian citizens, especially those who do not have checking or savings accounts and credit cards alone. The electronic currency will be backed by the assets of the Central Bank of Ecuador, the National Assembly said in a statement.[50]In December 2015, Sistema de Dinero Electrnico (electronic money system) was launched, making Ecuador the first country with a state-run electronic payment system.[51]

It is popular with college students, but has some security issues.

The Bank of Canada teamed up with the nations five largest banks and the blockchain consulting firm R3 for what was known as Project Jasper. In a simulation run in 2016, the central bank issued CAD-Coins onto a blockchain similarEthereum.[46]The banks used the CAD-Coins to exchange money the way they do at the end of each day to settle their master accounts.[46]

Hong KongsOctopus cardsystem: Launched in 1997 as an electronic purse for public transportation, is the most successful and mature implementation of contactless smart cards used for mass transit payments. After only 5 years, 25 percent of Octopus card transactions are unrelated to transit, and accepted by more than 160 merchants.

Chamber of Digital CommerceThe Digital Chamber is an authoritative representative for the digital commerce industry in Washington, promoting the acceptance and use of digital assets.

South Koreaplans national digital currency using a Blockchain.[57]The chairman of South Koreas Financial Services Commission (FSC), Yim Jong-yong, announced that his department will Lay the systemic groundwork for the spread of digital currency.[57]South Korea has already announced plans to discontinue coins by the year 2020.[58]

What does Cryptocurrency mean?, technopedia, 01-07-2013

Al-Laham, Al-Tarawneh, Abdallat (2009).Development of Electronic Money and Its Impact on the Central Bank Role and Monetary Policy

Antony Peyton.Blockchain goes Dutch» Banking Technology.

This page was last edited on 29 May 2018, at 14:41.

Government urged to use Bitcoin-style digital ledgers.

which used simpleshort message servicefacilities offeature phonesintended for pay-as you go services including taxis and pre-pay phone recharges via a BBVA current bank account debit.

Handbook of Digital Currency: Bitcoin, Innovation, Financial Instruments, and Big Data

Cashless society: Denmark to allow shops to ban paper money.

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The Danish government proposed getting rid of the obligation for selected retailers to accept payment in cash, moving the country closer to a cashless economy.[48]The Danish Chamber of Commerce is backing the move.[49]Nearly a third of the Danish population usesMobilePay, a smartphone application for transferring money.[48]

OGrady, Jason D.A crypto-currency primer: Bitcoin vs. Litecoin. ZDNet

The chief economist ofBank of England, the central bank of the United Kingdom, proposed abolition of paper currency. The Bank has also taken an interest in bitcoin.[46][63]In 2016 it has embarked on a multi-year research programme to explore the implications of a central bank issued digital currency.[38]The Bank of England has produced several research papers on the topic. One suggests that the economic benefits of issuing a digital currency on a distributed ledger could add as much as 3 percent to a countrys economic output.[46]The Bank said that it wanted the next version of the banks basic software infrastructure to be compatible with distributed ledgers.[46]

at about the same time. The wallet can be charged with regular bank accounts or cards and discharged by participating retailers using a technique known as money messages. The service closed in 2014.

On September 19, 2011,Google Walletreleased in the United States to make it easy to carry all your credit/debit cards on your phone.

Digital currency(digital moneyorelectronic moneyorelectronic currency) is a type ofcurrencyavailable only in digital form, not in physical (such asbanknotesandcoins). It exhibits properties similar to physical currencies, but allows for instantaneous transactions and borderless transfer-of-ownership. Examples includevirtual currenciesandcryptocurrencies[1]or even central bank issueddigital base money. Like traditionalmoney, these currencies may be used to buy physicalgoodsandservices, but may also be restricted to certain communities such as for use inside an online game or social network.[2]

This Day in Tech: Google Wallet launches. September 19, 2011.

From Wikipedia, the free encyclopedia

Cryptocurrencies allow electronic money systems to be decentralized. The first and most popular system isbitcoin, a peer-to-peer electronic monetary system based on cryptography.

Bitcoins Spark Regulatory Crackdown as Denmark Drafts Rules

Sidel, Robin (22 December 2013).Banks Mostly Avoid Providing Bitcoin Services

In Introduction to Electronic Money Issues – Appendixes

In 2012IrelandO2(owned byTelefnica) launched Easytrip to payroad tollswhich were charged to the mobile phone account or prepay credit.

Riksbanken.Skingsley: Should the Riksbank issue e-krona?.

Cashless Ukraine: The National Bank Considers Blockchain Technology.

Virtual currency schemes – a further analysis

Zetter, Kim (9 June 2009).Bullion and Bandits: The Improbable Rise and Fall of E-Gold.

A cryptocurrency is a type of digital asset that relies oncryptographyfor chaining together digital signatures of asset transfers,peer-to-peernetworking anddecentralization. In some cases aproof-of-workorproof-of-stakescheme is used to create and manage the currency.[25][26][27][28]

Griffith, Ken (April 16, 2014).A Quick History of Cryptocurrencies BBTC Before Bitcoin.

Digital vs. Virtual Currencies. Andrew Wagner

In 1983, a research paper byDavid Chaumintroduced the idea of digital cash.[4]In 1990, he foundedDigiCash, an electronic cash company, in Amsterdam to commercialize the ideas in his research.[5]It filed for bankruptcy in 1998.[6][7]In 1999, Chaum left the company.

Currency can be exchanged electronically usingdebit cardsandcredit cardsusingelectronic funds transfer at point of sale.

Digital money can either be centralized, where there is a central point of control over the money supply, or decentralized, where the control over the money supply can come from various sources.

Foley, Stephen (November 28, 2013).E-gold founder backs new Bitcoin rival. Financial Times

Apple Watch works with Apple Pay to replace your credit cards. September 9, 2014.

In May 2014 the U.S.Securities and Exchange Commission(SEC) warned about the hazards of bitcoin and other virtual currencies.[34]

Putin Confirms Russia Will Regulate ICOs, Mining By July 2018. Cointelegraph. 24 October 2017

In 1997, Coca-Cola offered buying from vending machines using mobile payments.[8]After thatPayPalemerged in 1998.[9]Other system such ase-goldfollowed suit, but faced issues because it was used by criminals and was closed by U.S Department of Justice in 2005.[10][5]In 2008,bitcoinwas introduced, which marked the start of digital currencies.[5]

BelgiumProton: Anelectronic purseapplication fordebit cardsin Belgium. Introduced in February 1995, as a means to replace cash for small transactions. The system was retired in December 31, 2014.

Worstall, Tim.Bitcoin Is More Like A Speculative Investment Than A Currency.

According to theEuropean Central Banks 2015 Virtual currency schemes a further analysis report, virtual currency is a digital representation of value, not issued by a central bank, credit institution or e-money institution, which, in some circumstances, can be used as an alternative to money.[13]In the previous report of October 2012, the virtual currency was defined as a type of unregulated, digital money, which is issued and usually controlled by its developers, and used and accepted among the members of a specific virtual community.[14]

According to theBank for International SettlementsNovember 2015 Digital currencies report, it is an asset represented in digital form and having some monetary characteristics.[15]Digital currency can be denominated to a sovereign currency and issued by the issuer responsible to redeem digital money for cash. In that case, digital currency represents electronic money (e-money). Digital currency denominated in its own units of value or with decentralized or automatic issuance will be considered as a virtual currency.

from the original on 6 November 2012.

Tucker, Toph.Bitcoins Volatility Problem: Why Todays Selloff Wont Be the Last.

Soft electronic currencies are the opposite of hard electronic currencies. Payments can be reversed. Usually when a payment is reversed there is a clearing time. This can take 72 hours or more. Examples of soft currencies arePayPaland any type ofcredit card. A hard currency can be softened with a third party service.[65]

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Central Banks Consider Bitcoins Technology, if Not Bitcoin.

Swedenis in the process of replacing all of its physical banknotes, and most of its coins by mid 2017. However the new banknotes and coins of theSwedish kronawill probably be circulating at about half the 2007 peak of 12,494 kronor per capita. TheRiksbankis planning to begin discussions of an electronic currency issued by the central bank to which is not to replace cash, but to act as complement to it.[59]Deputy Governor Cecilia Skingsley states that cash will continue to spiral out of use in Sweden, and while it is currently fairly easy to get cash in Sweden, it is often very difficult to deposit it into bank accounts, especially in rural areas. No decision has been currently made about the decision to create e-krona. In her speech Skingsley states: The first question is whether e-krona should be booked in accounts or whether the ekrona should be some form of digitally transferable unit that does not need an underlying account structure, roughly like cash. Skingsley also states: Another important question is whether the Riksbank should issue e-krona directly to the general public or go via the banks, as we do now with banknotes and coins. Other questions will be addressed like interest rates, should they be positive, negative, or zero?

E-cash redirects here. For the 20th century brand, seeecash.

Text is available under the; additional terms may apply. By using this site, you agree to theTerms of UseandPrivacy Policy. Wikipedia® is a registered trademark of theWikimedia Foundation, Inc., a non-profit organization.

Wary of Bitcoin? A guide to some other cryptocurrencies, ars technica, 26-05-2013

UK Digital Currency AssociationNon-profit organisation to inform public debate and promote growth-friendly policy and regulation for digital currencies in the United Kingdom

Digital Currency CouncilTraining, certification & support for lawyers, accountants, and financial professionals in the digital currency economy.

Swiss Federal Railways, government-owned railway company of Switzerland, sells bitcoins at its ticket machines.[61][61]

In the United States, electronic money is governed by Article 4A of theUniform Commercial Codefor wholesale transactions and theElectronic Fund Transfer Actfor consumer transactions. Providers responsibility and consumers liability are regulated under Regulation E.[31][32]

In about 2005TelefnicaandBBVA Banklaunched a payment system inSpaincalled Mobipay

On March 20, 2013, the Financial Crimes Enforcement Network issued a guidance to clarify how the Secrecy Actapplied to persons creating, exchanging, and transmitting virtual currencies.[33]

In March 2018, theMarshall Islandsbecame the first country to issue their own cryptocurrency and certify it as legal tender; the currency is called the sovereign.[44]

SydneyEmber (21 August 2014).More Comments Invited for Proposed Bitcoin Rule.

Chinas virtual currency threatens the Yuan

In 2016, acity governmentfirst accepted digital currency in payment of city fees.Zug, Switzerland, added bitcoin as a means of paying small amounts, up to 200 SFr., in a test and an attempt to advance Zug as a region that is advancing future technologies. In order to reduce risk, Zug immediately converts any bitcoin received into the Swiss currency.[60]

Chaum, David (1982).Blind signatures for untraceable payments

. Frankfurt am Main: European Central Bank. October 2012. p.5.ISBN978-92-899-0862-7Archived

Taxonomy of money, based on Central bank cryptocurrencies by Morten Linnemann Bech and Rodney Garratt

A number of electronic money systems usecontactless paymenttransfer in order to facilitate easy payment and give the payee more confidence in not letting go of their electronic wallet during the transaction.

In 1994MondexandNational Westminster Bankprovided an electronic purse to residents ofSwindon

As of 2016, over 24 countries are investing in distributed ledger technologies (DLT) with $1.4bn in investments. In addition, over 90central banksare engaged in DLT discussions, including implications of acentral bank issued digital currency.[38]

Celent calls on central banks to issue their own digital currencies /Euromoney magazine.

Frances Schwartzkopff; Peter Levring (18 December 2013).

Wikoff, Shawn (2016-09-13).The expert Shawn Wikoff talks about Electronic money.

Unified Payments Interface(UPI) is an instant real-timepayment systemdeveloped byNational Payments Corporation of Indiafacilitating inter-bank transactions. The interface is regulated by theReserve Bank of Indiaand works by instantly transferring funds between two bank accounts on amobile platform. UPI is built overImmediate Payment Service(IMPS) for transferring funds. Being a digital payment system it is available 24*7 and across public holidays. Unlike traditional mobile wallets, which takes a specified amount of money from user and stores it in its own accounts, UPI withdraws and deposits funds directly from the bank account whenever a transaction is requested. It uses Virtual Payment Address (a unique ID provided by the bank), Account Number withIFS Code,Mobile Number with MMID (Mobile Money Identifier),AadhaarNumber, or a one-time use Virtual ID. An UPI-PIN (UPI Personal Identification number that one creates on the UPI app of the bank) is required to confirm each payment.

Ecuador to Create Government-Run Digital Currency as It Bans Bitcoin.

SBB: Make quick and easy purchases with Bitcoin.

Szu Ping Chan side the Bank of Englands vaults: can cash survive?.


As such, bitcoin is a digital currency but also a type of virtual currency. Bitcoin and its alternatives are based on cryptographic algorithms, so these kinds of virtual currencies are also called cryptocurrencies.

In January 2010,Venmolaunched as a mobile payment system through SMS, which transformed into a social app where friends can pay each other for minor expenses like a cup of coffee, rent and paying your share of the restaurant bill when you forget your wallet.

Liu, Alec.Beyond Bitcoin: A Guide to the Most Promising Cryptocurrencies. Vice Motherboard

Hard electronic currency does not have the ability to be disputed or reversed when used. It is nearly impossible to reverse a transaction whether it is justified or not. It is very similar to cash. Advantages of this system include it being cheaper to operate, and transactions are instantaneous. Western Union,KlickExandBitcoinare examples of this type of currency.[65]

A generalized introduction and Q&A regarding the most widely used digital currency: bitcoin.

TheDutch central bankis experimenting with a bitcoin-based virtual currency called DNBCoin.[46][54]

Articles with dead external links from December 2016

Bobelian, Michael (9 May 2014).SEC Warns Investors To Beware Of Bitcoin.

Contactless convenience with Sonys FeliCa.

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Easytrip, O2 launch mobile toll payments service in the Republic of Ireland.

. Department of Computer Science, University of California, Santa Barbara, CA.

It can be linked to your bank account, credit/debit card or have a loaded value to limit the amount of loss in case of a security breach. Credit cards and non-major debit cards incur a 3% processing fee.

Bobelian, Michael (25 July 2014).New Yorks Financial Regulator, Benjamin Lawsky, Maintains Lead On Bitcoin Regulation.

Digital currency is a money balance recorded electronically on astored-value cardor other device. Another form of electronic money is network money, allowing the transfer of value oncomputer networks, particularly theInternet. Electronic money is also a claim on a privatebankor other financial institution such asbank deposits.[3]

Many of existing digital currencies have not yet seen widespread usage, and may not be easily used or exchanged. Banks generally do not accept or offer services for them.[66]There are concerns that cryptocurrencies are extremely risky due to their very highvolatility[67]and potential forpump and dumpschemes.[68]Regulators in several countries have warned against their use and some have taken concrete regulatory measures to dissuade users.[69]The non-cryptocurrencies are allcentralized. As such, they may be shut down or seized by a government at any time.[70]The more anonymous a currency is, the more attractive it is to criminals, regardless of the intentions of its creators.[70]ForbeswriterTim Worstallhas written that the value of bitcoin is largely derived from speculative trading.[71]Bitcoin has also been criticised for its energy inefficient SHA-256-basedproof of work.[72]

.Archivedfrom the original on 20 September 2016


Most of the traditionalmoney supplyisbank moneyheld on computers. This is also considered digital currency. One could argue that our increasingly cashless society means that all currencies are becoming digital (sometimes referred to aselectronic money), but they are not presented to us as such.[16]

TheNational Bank of Ukraineis considering a creation of its own issuance/turnover/servicing system for a blockchain-based national cryptocurrency.[64]The regulator also announced that blockchain could be a part of a national project called Cashless Economy.[64]

Commons category with local link different than on Wikidata

Federal Deposit Insurance Corporation

From your wallet to Google Wallet: your digital payment options, The Conversation, 26-05-2013

The: As an electronic cash system used in the Netherlands, all ATM cards issued by the Dutch banks had value that could be loaded via Chipknip loading stations. For people without a bank, pre-paid Chipknip cards could be purchased at various locations in the Netherlands. As of January 1, 2015, you can no longer pay with Chipknip.

Everett Rosenfeld (2015-02-09).Ecuador becomes the first country to roll out its own digital durrency.

Andrii Degeler (2012-12-19).Yandex Sells 75% Of Yandex.Money To Sberbank For $60M.

A virtual currency has been defined in 2012 by theEuropean Central Bankas a type of unregulated, digital money, which is issued and usually controlled by its developers, and used and accepted among the members of a specificvirtual community.[14]TheUS Department of Treasuryin 2013 defined it more tersely as a medium of exchange that operates like a currency in some environments, but does not have all the attributes of real currency.[29]The key attribute a virtual currency does not have according to these definitions, is the status as legal tender.

BoE explores implications of blockchain and central bank-issued digital currency.

JapansFeliCa: A contactless RFIDsmart card, used in a variety of ways such as in ticketing systems for public transportation, e-money, and residence door keys.

On Digital Currencies, Central Banks Should Lead – Bloomberg ViewBloomberg

LondonTransportsOyster cardsystem: Oyster is a plastic smartcard which can hold pay as you go credit, Travelcards and Bus & Tram season tickets. You can use an Oyster card to travel on bus, Tube, tram, DLR, London Overground and most National Rail services in London.

Uhlig/jse, Christian (1 July 2016).Alpine Crypto Valley pays with Bitcoins.

FIN-2013-G001: Application of FinCENs Regulations to Persons Administering, Exchanging, or Using Virtual Currencies. Financial Crimes Enforcement Network. 18 March 2013. p.6.Archivedfrom the original on 2013-03-19.

Marshall Islands to issue own sovereign cryptocurrency. Reuters

. Academic Press. p.211.ISBN18

Main article:List of digital currencies

Deutsche Börse Group – Joint Deutsche Bundesbank and Deutsche Börse blockchain prototype.

A deputy governor at thecentral bank of China, Fan Yifei, wrote that the conditions are ripe for digital currencies, which can reduce operating costs, increase efficiency and enable a wide range of new applications.[46]According to Fan Yifei, the best way to take advantage of the situation is for central banks to take the lead, both in supervising private digital currencies and in developing digital legal tender of their own.[47]

O2 – O2 money – The O2 Wallet service closed on 31st March 2014.

TheGerman central bankis testing a functional prototype for the blockchain technology-based settlement of securities and transfer of centrally-issued digital coins.[52][53]

Articles with permanently dead external links

TheBank of Canadahave explored the possibility of creating a version of its currency on the blockchain.[45]

Denmark proposes cash-free shops to cut retail costsReuters. 2015-05-06

Virtual currencies pose challenges for central banks, financial regulators, departments or ministries of finance, as well as fiscal authorities and statistical authorities.

Since 2001, the European Union has implemented theE-Money Directiveon the taking up, pursuit and prudential supervision of the business of electronic money institutions last amended in 2009.[30]Doubts on the real nature of EU electronic money have arisen, since calls have been made in connection with the 2007 EUPayment Services Directivein favor of merging payment institutions and electronic money institutions. Such a merger could mean that electronic money is of the same nature asbank moneyorscriptural money.

South Korea plans national digital currency using a Blockchain. Brave New Coin. 2016-10-26

Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC, Official Journal L 267, 10/10/2009 P. 0007 – 0017

The Chief Scientific Adviser to the UK government advised his Prime Minister and Parliament to consider using a blockchain-based digital currency.[62]

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