What are digital currencies and their most well-known types

Although digital currencies do not see them with their own eyes and do not touch them with their hands, they have made a breakthrough in the digital economy worldwide; this has even led to the tendency of many central banks around the world to link their national currency to stable digital currencies, in an attempt by these banks to keep up with developments in the online world-payments in a new economic era based on symbols and numbers on a computer screen.

Digital currencies are numbers and symbols that you find on your computer screen or mobile phone, each currency has its own symbol or signal, but nevertheless it has an impact on the global economy, especially with its wide popularity in most parts of the world, at a time when large investors and businessmen are trading to the world led by Elon Musk, who promoted it with investments of up to $1.5 billion in these currencies as the fastest way to make a profit; he even recently announced the possibility of using cryptocurrency as a payment method for Tesla cars owned by him .. But despite all this, many people come up with the most important question: what are digital currencies

What are Digital currencies

They are also called digital money, electronic money or electronic currencies, and they are a type of currency available only in digital form and have no physical existence, such as banknotes or metal, however, they have the same characteristics as in other financial currencies, so instant transactions and transfer of ownership are carried out on their without restrictions; they can even be used to purchase various goods and services; they are an electronically recorded financial balance on a card with the value stored on another device and sold over the Internet, they can also have a central point of the money supply, which makes them stable digital money, there are some decentralized currencies and the money supply is controlled by various sources.

A digital currency can also be defined as a form of currency or a means of useful exchange that has characteristics similar to tangible physical currencies, but is digital, not tangible, and allows instant transactions, buying and selling, like tangible currencies.

The origins of digital currencies date back to 1990, when they started working with information technology, where the beginning was laid through electronic gold products, which was founded in 1996, until 2006, and the Liberty Reserve website began to establish a well-known digital currency that allows users to convert dollars or euros into digital currency the currency between the dollar and the euro is on the same site and allows exchange between them for a fee of 1%; however, the US government completely shut it down after accusations that it was used for money laundering.

In China, in particular, in 2005, a kind of digital currency based on commodities began to be used through the Tencent QQ platform through "Q" coins, but accusations of destabilization of the official Chinese currency "yuan" due to speculation also followed, and therefore could not have a strong impact.

In 2018, digital currencies began trading in a new and modern form with bitcoin, which in 2009 became the most widely used digital currency worldwide and began to spread between countries.

Although some believe that digital currencies are only one type, which is bitcoin, there are too many types, according to the website "CoinMarketCap.com " digital currency specialist, there are more than 6,700 digital currencies traded over the Internet in various countries around the world, as well as many companies that have started to issue their own a digital currency that can be used to purchase services and products for a company, but, nevertheless, there are types that are the most well-known and most traded in the world, namely the following:

Bitcoin Bitcoin BTC

This is a virtual currency that has no real physical existence, but it is the most traded in the world, despite the fact that it is used in transactions with cryptocurrencies and illegal transactions, since it provides money without a name, it is impossible to find out the owners of this currency or any information about their identity.

The bitcoin mechanism hides the identity of the owner of the currency (sender), as well as the recipient of funds (addressee), and therefore can be used in money laundering operations and illegal transactions, and this makes it difficult for countries to identify or regulate them by central financial agencies, since it is impossible to control their movement, which is in accordance with the policy of supply and demand.

But due to the frequent use of this currency by bitcoin countries, many countries were forced to recognize it, and it became officially dealt with, but in a way that serves their interests and is under the control and tracking of the central financial agency.

Ethereum Ethereum ETH

One of the most famous digital currencies that is trying to compete with bitcoin was created in 2015 and did not have a strong circulation until 2016, when 500 wealthy companies gathered to discuss and join efforts to develop a technological network, and this currency was supported as a destination for digital currencies between the company and the acceleration of decentralization in the global economy.

Although it is volatile, it can be used as a financial asset for traders, as it differs from bitcoin in that it allows customers to run any program to access it through a decentralized application and is not controlled by any separate or centralized system; therefore, it is a convenient technological investment between companies.

Bind Bind USDT

It is a digital currency that converts recognized currencies such as the dollar or euro into a digital currency that follows a well-known protocol, which is the "Omni Layer" in the trading platform, and its debut dates back to 2014 and is based in Hong Kong.

Each currency is backed by one US dollar, which means that reserves in US dollars are equal to currencies whose purpose is to combine digital currencies with fixed currencies such as the dollar.

Binance Coin

BNB Binance Coin

It is a cryptocurrency used as an intermediary in the exchange of money from one currency to another, founded in 2017 for the Chinese company Beijing Technology in Hong Kong, which operates the Binance exchange, one of the most successful exchanges in the world for leading and well-known cryptocurrencies.

Dogecoin Dogecoin DOGE

The cryptocurrency, founded in 2013, is an instant, cheap and pleasant payment system that does not require the costs associated with banking transactions, and is essentially a modified version of the popular Bitcoin currency.

The dogcoin coin started as a joke and was symbolized by the image of a dog from the Shiba Inu family, and at the time of its launch it cost a fraction of a cent, but in a short time it gained supporters, and its purchase increased significantly until it raised its value by 6000%.

It is characterized as an easy and smooth currency for working with hard-to-access currencies such as bitcoin, and investing in it does not require huge capital, while expectations indicate that its price will rise further in the future, and this is what famous businessman Elon Musk, owner of Tesla Motors, has done., announces that his company will accept payment for some of its products in the digital currency Dogecoin.