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Digital currency
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{{Short description|Currency stored on electronic systems}} {{redirect2|E-cash|Internet money|the 20th century brand|Ecash|the record label|Internet Money Records}} {{pp|small=yes}} {{Use dmy dates|date=October 2020}} {{Use American English|date=July 2020}} [[File:Money flower.png|thumb|450px|Taxonomy of money, based on "Central bank cryptocurrencies" by Morten Linnemann Bech and Rodney Garratt]] '''Digital currency''' ('''digital money''', '''electronic money''' or '''electronic currency''') is any [[currency]], [[money]], or money-like asset that is primarily managed, stored or exchanged on digital computer systems, especially over the [[internet]]. Types of digital currencies include [[cryptocurrency]], [[virtual currency]] and [[central bank digital currency]]. Digital currency may be recorded on a [[distributed database]] on the internet, a centralized electronic [[Database|computer database]] owned by a company or bank, within [[Computer file|digital files]] or even on a [[stored-value card]].<ref name="Al-Laham">{{Cite journal| last1=Al-Laham| last2=Al-Tarawneh| last3=Abdallat| first1=Mohamad| first2=Haroon| first3=Najwan| date=2009| title=Development of Electronic Money and Its Impact on the Central Bank Role and Monetary Policy| url=http://iisit.org/Vol6/IISITv6p339-349Al-Laham589.pdf |journal=Issues in Informing Science and Information Technology |volume=6 | pages=339β349| doi=10.28945/1063|access-date=12 May 2020| doi-access=free}}</ref> Digital currencies exhibit properties similar to traditional currencies, but generally do not have a classical physical form of [[Fiat money|fiat currency]] historically that can be held in the hand, like currencies with printed [[banknotes]] or minted [[coins]]. However, they do have a physical form in an unclassical sense coming from the computer to computer and computer to human interactions and the information and processing power of the servers that store and keep track of money. This unclassical physical form allows nearly instantaneous transactions over the internet and vastly lowers the cost associated with distributing notes and coins: for example, of the types of money in the [[UK economy]], 3% are notes and coins, and 79% as electronic money (in the form of bank deposits).<ref>{{cite web|title=How is money created? - Bank of England|url=https://www.bankofengland.co.uk/knowledgebank/how-is-money-created|access-date=4 September 2022}}</ref> Usually not issued by a governmental body, virtual currencies are not considered a [[legal tender]] and they enable [[ownership]] transfer across governmental [[border]]s.<ref name="BIS2015" /> This type of currency may be used to buy physical [[goods]] and [[Service (economics)|services]], but may also be restricted to certain [[Online community|communities]] such as for use inside an online game.<ref>{{cite web|title=Digital currencies are impacting video games with...|url=https://www.offgamers.com/blog/digital-currencies-are-impacting-video-games-with-new-exciting-possibilities/|publisher=Offgamers|access-date=6 November 2018|archive-date=22 November 2018|archive-url=https://web.archive.org/web/20181122142957/https://www.offgamers.com/blog/digital-currencies-are-impacting-video-games-with-new-exciting-possibilities/|url-status=dead}}</ref> Digital money can either be centralized, where there is a central point of control over the money supply (for instance, a bank), or [[Decentralization|decentralized]], where the control over the money supply is predetermined or agreed upon democratically.
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