What is Digital Gold?
Throughout our recorded history, one precious metal, gold, has been a preferred store of wealth and a medium of exchange. But it's inconvenient. Most people don't want to store bullion in their homes and then have to shave a little piece off an ingot to go grocery shopping. Of course in places like Thailand, they do something similar. When they need to go into their savings, they break off a link and spend their jewellery. Chinese merchants have scales to weigh and instruments to verify purity of gold. But still for everyday transactions, even in Thailand, standardized coins or banknotes are more convenient. The notion that we cannot move our own money abroad when we want to would have been dismissed with disbelief by Marco Polo as he forged his way around the globe. We certainly don't need to go back to Marco Polo today. Individuals and investors can still move their assets in and out legally with some reporting requirements and very few other restrictions. Thus, new alternatives like digital currencies should be seriously considered by privacy seekers. Paper money first developed when gold traders found they could issue receipts or I.O.U.'s payable to the bearer in return for gold deposits in the vault of their bank. People found that these slips of paper were much more convenient than the physical gold itself for the settling of day to day debts. If anyone wanted to cash in, they would simply take the paper money to the bank and demand their gold.
Digital gold operates on the same principle. The physical gold is stored in a central vault, but ownership is transferred by logging into one's gold account using a secure internet connection and password. This allows the legal right to a certain amount of the gold to be transferred in an instant to somebody on the other side of the globe, and it also allows the gold to be divided up into almost infinitely tiny fractions of an ounce or gram if necessary, which is much more convenient than using physical gold.
Why Use Digital Currencies?
Many economists believe that digital currencies will prove to be as world changing as the invention of the printing press and gunpowder. Digital currencies link together financial institutions and markets across the globe in a way that allows instantaneous value transfers with a mere fraction of the cost associated with traditional bank wires and credit cards, free enterprise at it's finest! The architects of the new digital economy are busily at work creating new financial products and linking digital currencies to "old world" money and financial networks, allowing you to easily convert your digital currencies to cash anywhere in the world. Here are some of the reasons that digital currencies are the best way to do business on or off the net! CNN reports that digital cash is about to change the nature of money as we know it...
1) Digital Currencies are faster and non-reputable: The average credit card transaction can be reversed for three to six months after the sale takes place. This leaves merchants in a vulnerable position. Cheapskates reverse the charges on a regular basis against merchants who have delivered the goods. This kind of theft drives up prices for everyone to cover the cost of lost goods and money due to fraudulent credit card use. Bank wires in - country take at least three days to clear. International bank wires can take up to two weeks to clear depending on where they are from. Digital currencies solve all these problems by allowing instantaneous and non-reversable transactions! For merchants this means that all sales are final. They don't have to worry about having their account frozen because some hacker used a stolen credit card at their store. This also means that when you need to send money to a friend or family member anywhere in the world, you can in a few seconds, and they can withdraw it as cash from any ATM machine almost the very next instant if they like, that's fast!
2) Digital Currencies are International! Paypal only works in the United States. In order for people outside the US to sell their product or service on the web, they have needed an international credit card merchant account. The problem has been that outside of the U.S. and E.U., merchant accounts can be difficult to obtain. This creates a barrier to entry that can make it harder for international entrepreneurs to offer their products and services to the world using the internet. Digital currencies solve this problem by allowing instantaneous transfers of money anywhere in the world! As the network of exchange agents grows, it is now possible to quickly and easily convert your digital currency to cash in any country in the world. This means that no matter where you are, if you can find an ATM machine, you can convert your digital currency into local currency.
3) Digital Currencies are Safer! Credit card fraud is becoming increasingly prevalent as hackers steal card numbers from computer networks. Crooks root through your garbage and steal your identity (consider buying a cross cut shredder for your home use) , and other nefarious thieves devise ways to get your account number. Digital currencies offer a higher level of security than credit cards. Even the lowest level of security for digital money, an account number and password, is one order of magnitude safer than a credit card. All a thief needs to steal a credit card is the account number. With digital currencies, the merchant never sees your password, so it is impossible for a thief to steal it, unless you give it to him yourself. The premier gold currency, Gold Money, supports digital certificates for customer identification. These certificates cryptographically verify that you are you, this prevents thieves from accessing your account. Pecunix supports the use of a pgp key. Both also offer you the option of restricting the I.P. addresses that can access your account. It's also possible to combine digital certificates with an affordable biometric fingerprint reader to make sure that absolutely No-One has access to your account but you. This is the highest level of security currently available on the net, but there are other improvements still to come!
4) Digital Currencies Allow Person to Person Payments: Digital currencies allow one thing that credit cards never will, person to person payments. When you want to buy a collectors item or anything else you might like that you found in an online classified ad, and the owner lives in New Zealand and your in the U.S. or E.U., digital currencies make easy payment possible. They allow you to spend your money to anyone else who has a digital currency account. It only takes a few minutes for your friend to open his or her digital currency account over the internet and it's absolutely FREE.
Digital Currencies Help You to Protect Your Privacy and Anonymity!
One of the most appealing features of a digital currency account that people have commented on is it's ability to protect your privacy. It's a known fact that traditional banks store massive databases tracking all of your account activity in the name of "know your customer". In reality, we all know that some banks conveniently use those databases to sell information about customers habits to other organizations, and can even use this information to market different products to customers themselves. Digital currencies do not report.
Choosing Your Digital Gold Company:
There are several competing systems and digital currency providers to choose from, and generally it is free to open an account with no commitment required. There is also nothing to stop you from having as many accounts as you like. One newer digital currency company is C-Gold www.c-gold.com (they began in 2005). C-Gold is very professionally run. They have a good audit system, are offshore, and the customer care is fine. There is also Pecunix www.pecunix.com a Panama based up and coming offshore digital gold system that is becoming accepted at more and more locations of internet business since 2001 when it was first established, it seems to be very reliable, private, highly secure, insured by Lloyds of London, and very efficient. Pecunix stores all customers gold in Switzerland. There are a number of other smaller digital currency systems up on the net, but we don't recommend them. They can be unstable or even fraudulent. The above information is provided only as a general information courtesy to our clients and visitors, we highly recommend that you do your own due diligence before using any digital currency.
Using Your Digital Gold Account!
Logging into your digital gold account is very similar to logging into an on-line bank account. You can see the balance, check your statement, and make a transfer to any third party who has an account on the same system. If a third party has your account number, they can make a transfer to you. You can't write cheques, just make transfers, but these transfers cost almost nothing at all and clear with the second, not like transfers made within the traditional banking systems. The main difference is that the balance is held in actual gold not money. Due to this it is accounted for by weight. Most systems will allow you to view your balance in, or make transfers for, an equivalent amount in USD, EUR, GBP, etc, but these equivalent balances can change from one moment to the next based on movements in the price of gold on world markets. The only definite fixed balance is the one you can see in either troy ounces or grams, depending on which one you prefer. So just as if you were buying physical gold you can loose if the price of gold goes down, or gain if it goes up.