Comparison between electronic money and virtual money

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Comparison between electronic money and virtual money There are several electronic payment methods; Such as electronic money and virtual money, and there are many essential differences between these two types, as follows:

In terms of definition:

electronic money is money or money that is exchanged electronically, and it is in the form of an electronic store or a technical device that stores monetary values, and is used in many areas; Such as payment to parties other than those that issued it, and it also acts as a pre-payment tool.[1] Virtual money is a type of unregulated digital currency, which is available only in its electronic form, and virtual money can be stored and dealt with through Dedicated programs, mobile or computer applications, or through dedicated digital wallets, and their monetary transactions are via the Internet using dedicated secure networks, also called cryptocurrencies.

[2] In terms of production and ownership:

electronic money can be created in several steps; First, the buyer gets a certain amount of it by one of the issuing banks in the form of small cash units called (Tokens), then the buyer gets a special program for the purpose of managing electronic money. This program is unpaid and provided by the company (Cyber ​​cash), which protects the monetary units from any erasure or copying, as for the seller who deals with this type of money; It must partner with a bank issuing electronic money, and must also acquire a special program from the same company (Cyber ​​cash) to secure and protect electronic money in the field of sales.[3]

Also, any individual can create and own a new virtual currency by creating a (blockchain). ; It is one of the cryptographic techniques in a single currency, and it is possible to use several online educational programs to learn how to create a virtual currency, and it must be noted that to create such a currency it requires possessing at least basic cryptographic skills and a deep understanding of the (blockchain) [4]

in terms of the type of control and supervision:

In the event that electronic money is issued by the Central Bank, there is no type of supervision over that, but if it is issued by ordinary banks or credit or non-credit institutions, in this case, electronic money must be subject to digital supervision and control by central bank; To avoid all risks that result from the issuance of this money by these institutions.[5]

As for virtual money, it is not subject to any kind of supervision or control, whether by the central bank or any official body in the country.[6]

In terms of the exporter:

the exporter is known. ; that it is the authority responsible for issuing this type of money, and that the first source of electronic money is the central bank located in any country, and credit and non-credit institutions that carry out money business can be its exporter; Like France, also banks and financial institutions; Like America, but provided that it is subject to the control and supervision of central banks.

[7] As for virtual money, it is a type of unregulated digital money as we mentioned earlier, and therefore is not issued or controlled by the central bank, it is usually issued by special issuers for that Or specific individuals, as used by specific virtual communities.[8] In terms of public opinion and the degree of acceptance, one of the advantages that electronic money enjoys is that it is widely accepted, whether by individuals or institutions, where its user can deal with it with several other parties or Banks, and the degree of acceptance of electronic currency may depend on: the efficiency of the issuer, and confidence in the commercial field.

[7] Contemporaries have varied opinions on virtual money, previously dealing with virtual money was very limited, but at the present time the exchange of the new virtual currency has expanded in a way Remarkably, especially Bitcoin, which has proven itself globally, and Germany is the first country to recognize that Bitcoin is a type of electronic money, but virtual money still enjoys a lack of confidence among some, depending on what it entails on the one hand. Issuance and the entities controlling it.

[9] In terms of revealing the identity of the customer :

during transactions, in this aspect, two types of electronic money must be distinguished: nominal electronic money, and non-nominal electronic money. In the first type, the identity of the customer is revealed; Because it contains an electronic cash unit that is linked to all the people who trade it. As for the second type; The identity of the holder is not disclosed during transactions, unless the same person spends it more than once,

[10] for virtual currency; The identity of the customer is not revealed during trading in transactions.

[11] In terms of transparency in transactions:

electronic money enjoys high transparency in transactions, as the texts related to electronic money are very clear, as they show the rights and obligations of each of its parties,[12] With regard to virtual money, one of its distinguishing features is transparency, according to Primavera de Filippi, a researcher at the National Center for Scientific Research in Paris. In addition to the number of transactions that have taken place, and therefore anyone can view them with complete transparency.

[14] In terms of the legal status of electronic money:

it has no legal basis; There are also no legislations that compel the individual to deal with it, and legal release does not apply to it, and this means that the creditor can refuse to use it by the debtor to pay, and demand the collection of the debt through cash payment in the traditional form, and therefore electronic money is only one of the electronic payment methods, and don't swear
It is classified as a new type of money.[7] As for virtual money and the fact that it is not subject to any control body, most countries of the world did not officially allow it, but rather warned some of them against dealing with it due to the lack of government supervision over it, and because of the unknown identity of its holder, fraud and scams abound. Which makes the process of legal claim difficult.

[15] Examples of electronic money Common examples of electronic money are:
[7] Electronic wallet: An electronic wallet is a smart card that is used to store specific monetary values, using a magnetic tape or computer chip (embedded circuit), through which electronic money can be transferred to another card without the need to link it to a central computer or any other party.
Digital money: (English: Digi cash) in which the monetary value is stored in computer disks, and is used by the personal computer of the consumer party, but it must connect its network to the international communication network. Examples of Virtual Money Common examples of virtual money include:
Bitcoin: Bitcoin[1] is the first virtual digital currency; It is considered a cryptocurrency because cryptography facilitates the creation of bitcoin transactions, there are currently more than 18.5 million bitcoin tokens in circulation, against the current maximum of 21 million.
Bitcoin Cash: (h) was introduced in 2017 AD and is one of the most popular types of cryptocurrencies in the market. The essential difference between the original Bitcoin and Bitcoin Cash is the block size; The latter has a larger capacity, which means that Bitcoin Cash offers faster processing speeds than the original Bitcoin.
[17] Litecoin: It works as a way to use Bitcoin, created by Charlie Lee in 2011 AD, and was designed to improve the way Bitcoin works; In terms of shorter transaction times, and lower fees.[18] Ripple is a type of cryptocurrency, widely used by larger companies and institutions.[17] Stellar Designed by the founder The participant of (Ripple Jed McCaleb) in 2014 AD and it is operated by a non-profit organization called (, and aims to promote its use in developing countries that do not have access to any traditional banks.[19] Electronic money and virtual money are similar in Being money that is dealt with electronically only, without the traditional form of money known, and both types differ in many things; As the methods of its production and ownership, and its exporters, but in general, it is not recommended to deal with it except when reviewing all the provisions related to it in order to prevent fraud or fraud. It lacks many of the properties of traditional money, and electronic money is divided into two main types, namely; An electronic wallet that stores monetary values ​​based on integrated circuits, and digital money that stores monetary values ​​in computer disks.

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