Digital currency vs. Money - Essay Example

Digital currency vs. money Introduction Digital currency is increasingly becoming popular as opposed to money though it has its fair share of advantages and disadvantages. Digital currency is a medium of exchange that is based on the internet (Uwajeh 345). It exhibits similar properties to physical money but it allows for instant transactions and the borderless ownership transfer. Like money, these digital currencies can be used to purchase goods and services though they can be restricted in some communities.

Some of the digital currencies including bitcoin have no central control point over the supply of money (Vigna and Casey 56). Money on the other hand is an item accepted as the payment of various goods and even services and debts repayment in a socioeconomic context. Why people are switching to digital currency People are increasingly switching to digital currencies due to lack of trust in actual money. The increased cases of theft and pick pocketing are increasingly necessitating for individuals to use digital currencies (Mullan 567).

Critics of digital currencies over money There are other individuals who claim that they should never switch to digital currency due to inconvenience especially in remote areas. There are places where one can never use a digital currency (Kubota 200).Advantages of moneyEconomical since it costs nothing to the government making it a cheap medium of exchangeHomogenous since it must be the same typeConvenient since it is used everywhere even in remote areasCheap remittance from one place to anotherDisadvantagesIt is of no use outside its country of issueTheft and pick pocketing together with other damages to the paper money.

Danger of over issue in a countryAdvantages of digital currenciesFreedom in payment at any part of the worldControl and securityLow fees in its paymentFewer risks in terms of theft, or damagesDisadvantagesNot used in some parts of the socio-economy including the remote areasMight be expensive to acquireWorks CitedKubota, Takashi. Cyberlaw for global E-business. Hershey PA: Information Science Reference, 2008.Mullan, Philip. The digital currency challenge. Basingtoke: Palgrave Macmillan, 2014.

Uwajeh, Alex Nkenchor. Bitcoin and Digital Currency. New York: Alex Nkenchor Uwajeh, 2007.Vigna, Paul and Michael J Casey. The age of cryptocurrency. New York: St. Martins Press, 2015.