If you are not familiar with digital currency, it is the process by which you purchase, sell, or transfer it. These types of currencies have no physical form, but are just as useful as traditional fiat currency. In fact, digital currency is so similar to cash that it can be used as an account, as well as a means of daily transactions.
The biggest difference between digital money and actual cash is that you cannot physically carry it. When you transfer dollars from your online bank account, they take on a physical form when you withdraw them from an ATM.
Digital currency’s origins are traceable to the 1990s Dot-com bubble. For example, Liberty Reserve, which launched in 2006, lets users convert currencies for free. The company charges a one percent transaction fee. However, many digital currency operations were deemed to be a Ponzi scheme and a form of money laundering. In fact, some of these operations were shut down by the United States government for operating without MSB licenses. Another notable example of this is Q coins, which emerged in the early 2005 as commodity-based digital currencies.