Electronic currency

Introduction
Electronic currency is the money in electronic form that is backed by monetary values in actual circulation and can be used as tools of payment. Electronic currency is being developed as a next-generation method of electronic settlement. This involves use of computer networks, the internet and digital stored vales system, Electronic Funds Transfer and direct deposit are examples of electronic money. However, electronic currency required the collective term for financial cryptography and technologies to enable it.

Types of Electronic Currency
There are two distinct types of e-currency, identified e-currency and anonymous. Identified e-currency contains information of the person who withdrew the money from the bank. This type of e-currency enables the bank to track the money when it moves through the economy. Anonymous e-currency is just like real paper money. Once anonymous e-currency is withdrawn from an account, it can be spent or given away without leaving a transaction trail. It can be done in off-line; the merchants collect multiples e-money from users and deposit them into the bank.

There are several benefits by using Electronic currency, it is convenience and increased efficiency of transactions, lower transaction fees. However, the transfer of e-currency raises some problem such as how to levy taxes and the possible ease of money laundering. These issues may need some types cyberspace regulations to regulate the transactions.