The term "digital currency" is not a phrase referencing or describing online banking. Unlike government issued money which moves through conventional banks and financial institutions, digital currency is issued by private parties and only circulates over the Internet. It has some similar features of bank transfers, however, unlike credit cards and bank accounts, digital currency transactions are not plagued with fraudulent charge backs, high fees or long wait times for cleared funds.
Private companies are the underwriters and issuers of digital currency not government agencies. Consequently, these accounts are not FDIC insured as you would find in a regulated U.S. bank. Thus, it is important to understand that digital currency accounts are only as safe as the private company issuing the units and the governance of the assets backing those digital units.
In contrast to massive government agencies which issue national currencies on a grand scale, private digital currency companies are often extremely transparent. These online payment companies go through regular third party audits and publish all the information online. Most digital gold currency companies publish a list of the actual precious metal bars from the quarterly audited bar count. It is not unusual to find posted on the DGC company's web site a copy of the accountant's certification and a list of bar numbers.
Digital currency accounts offer global users convenience and freedom by permitting the electronic movement of funds from anywhere in the world using a personal computer or mobile device.
No bank or bank account is ever required. From the convenience of home, anyone can establish a digital currency account without jurisdictional restrictions and without the expensive hassles of a personal bank visit. Accounts in one jurisdiction may be instantly created by a consumer who lives just a kilometer away in a nearby town or another one thousands of miles away in a far away country. No office visit required. The financial freedom and opportunity that digital currency offers to both individuals and global businesses far exceeds the utility of a conventional bank account.
Digital currency accounts are unlike conventional bank accounts. Digital currency accounts are free, easy to set up plus all the transactions clear instantly and are irreversible.
Unlike credit cards, digital currency offers an "ease of use" which encourages both local and global online commerce. A simple account set up process, paired with the easy access provided by personal computers & cell phones, plus the lower costs of account operation gives digital currency a large advantage over banks. Outdated bank products such as credit cards, which were first introduced in the 1950's and never intended to be used online, prevent entry for new online merchants, restrict online commerce to those lucky enough to "qualify for a card" and widespread card industry fraud creates massive additional expenses.
The operation of a digital gold currency system is completely different from the present day fractional reserve banking system. Today's banks only require a tiny fraction of the money represented by a bank account to be actually held by the institution. Digital bank deposits and bank loans are created from thin air in a "ponzi like" structure with no assets backing the paper. Modern banking is debt built on top of debt over decades and decades of time. In total contrast to modern day banking, there is no debt created when digital gold currency is issued.
Digital gold currency offers a clean break from conventional bank debt. In total contrast to the " ponzi like" structure of fiat national currencies, privately issued digital currency units are at all times 100% backed by precious metal. DGC accounts are denominated in gold by weight not dollars, yen or euros.
Digital gold currency units are a representation of the allocated physical gold held in the vault. Unlike a conventional dollar denominated bank account which remains constant with the value of a dollar bill, DGC accounts fluctuate in value with the daily price of metals. The value of a user's DGC account as priced in national currency will change each day because of the changing spot prices.
Unlike a bank wire or a credit card transaction, digital currency transactions clear instantly and 100% of the received funds are available for spending.
Additionally, all transactions in digital currency are final and irreversible. There is no such thing as a digital currency "charge back". Digital currency accounts are not subject to expensive foreign currency conversions as is often the case with cross border bank transfers or overseas card charges. These privately issued electronic value transfer systems represent a huge leap forward in global financial services. Without traditional bank delays and high fees, digital currency account holders can transfer funds internationally in a manner that approximates traditional bank wires.
A cost savings is especially obvious when using digital gold currency accounts. Since digital gold is denominated into internationally recognized weights of precious metals, the inconveniences traditionally associated with international financial transactions, such as calculating exchange rates for another nation's currency, are eliminated.
Payments between DGC accounts are measured by amount of gold by weight transferred between accounts. DGC users understand that a gram of gold in one country is equal to a gram of gold in any other country. No floating national currency conversion or exchange loss ever occurs on any DGC transaction as it would in a bank transfer. Pure gold holds the same value everywhere in the world and can effortlessly move between countries around the world.
The ability to conduct transactions in digital currency is constantly available 7 days a week. This feature makes digital currency more accessible and convenient than other methods of bank transfer which may be limited by normal business hours and international time zones. Unlike a bank customer, the digital currency account holder may send or receive funds from anywhere in the world at anytime secure in the knowledge that those funds will clear only moments later.
Additionally, digital currency transactions can be conducted from any location or device which permits Internet access. GoldMoney even offers an iPhone application providing customers convenient & secure mobile access. Webmoney offers Telepat phone access and Keeper Mobile software. All of today's popular digital currency systems can be accessed by web enabled devices. Even as far back as the late 1990's e-gold was offering customers convenient mobile access.