digital money

Money stored and transferred in digital form. In the early days of the Internet, people were reluctant to use their credit cards online, and several payment systems were devised using a form of digital travelers checks (see digital coins and digital wallet).

After all was said and done, the traditional credit card systems became the primary form of online money transfer. Web browsers and Web servers support the Secure Sockets Layer (SSL) protocol, which provides an encrypted connection between the user and the online merchant (see SSL). See Web payment service.

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Electronic payment systems used in lieu of coin and currency. Although the terms electronic money and, the short version, e-money, are commonly used interchangeably with digital money (or digital cash), digital, strictly defined, refers to e-cash that is off-line, meaning you can conduct a transaction without interacting with a bank and anonymous, meaning the identity of the person who originally withdrew the money from a bank is protected through the use of blind signatures. The technology underlying digital money is complex and problematic; a number of companies providing digital money services have come and gone, and the technology is still evolving. E-money that is "on-line" and "identified" is more common, an example being the Electronic Wallet.