Blockchain – Electronic Cash

eCash is known as Electronic Cash which is a digital currency technique from which transactions can be achieved anywhere through the internet. It is an easier form of payment, it is based on the principles of blockchain technology (Digital Signatures) among the Peer-to-Peer network. All transactions and dealings are stored in specific digital databases. It is the alternate payment system to pay for bills, products, and services without the use of paper or coin currency. Applications of electronic or digital cash are digital cash, debit cards, electronic cases, electronic check, and credit cards. 

Features of Electronic Cash:

• Decentralized: This shows that it is managed by a centralized organization by distributed ledgers. It reduces the trust issues as the user may not need to trust anybody. It improves performance and consistency. It makes transactions irreversible.
• Transparency: This means that all transactions are visible and clear, and nothing will be hidden from the participants. This enhances the trust and faith in electronic cash.

History of eCash

• In 1983 the eCash was introduced by David Lee Chaum with the cryptography technology and established a company called Digicash in 1998. 
• In June 1998, the eCash was available through different banks such as Credit Suisse, Deutsche Bank, Bank Austria, and Den Norske Bank of Switzerland, Germany, Austria, and Norway respectively. 
• As it spread widely in the world rapidly but it went bankrupt in 1998 and the company was sold to eCash technologies including the eCash credits. 
• In 2000 eCash Technologies went bankrupt during the duration of the court case regarding the ownership of the domain name and in 2002 eCash was obtained by Blucora earlier was InfoSpace.

Examples of eCash

Famous cryptocurrencies Bitcoin and Ethereum are based on the principles of cryptography and blockchain, making them decentralized, and secure, and removing the third party from involvement with transactions. They are not authorized/backed by any organization properly or legally. 

• Cryptocurrencies: It is referred to as the digital currency which is developed using cryptography technology and is very much decentralized by its properties. The main advantage of cryptocurrency is it is a faster money transfer and is secured with transparency. But the cost of mining is higher and the fluctuations in cryptocurrency are quite unstable.
• Central Bank Digital Currencies: It is referred to as fiat currency which is fully authorized by the legal party. It doesn’t hide the transactions of payment like other digital currencies do. It is directly proportional to the country’s financial economy.
• Stablecoins: Stablecoins are the coins that are totally stable according to the currency rate of a specific country, such as Tether, TrueUSD, Binance USD, Dai, etc. Its currency rate is fixed to the fiat currency of a country like the USA. Its main demand is in the time of high investments as it is very much safe.

Advantages of Digital Money

Below are some of the advantages of eCash:

• Higher Flexibility and ability: Transaction through eCash can be done flexibly from anywhere around the globe easily. It removes all the difficulties which take place during transactions through the ordinary method.
• High Security: It is highly secured as it is traveling in the peer-to-peer network which involves cryptography keys. It is fully encrypted and can’t be modified without a decryption algorithm.
• Time Efficient: It saves the user time in the procedure of payment, the user can easily make payments with just a single click from its mobile or PC, just requiring internet service.
• No hard copy is required: No hard copy is required as the medium or as the prop it digitally travels from one system to another system.

Risk of Digital Money

The risk of using eCash is as follows:

• Higher Cyber Attacks: The probability of cyber-attacks and scams is more as it entirely depends on the internet, various attacks such as Phishing, Man-In-the-Middle attack, etc can easily occur.
• Space for infrastructure and databases is required: The transactions data are stored in databases so it requires big space and hardware infrastructure to keep the ledger data.
• Network issues can lead to unsuccessful transactions: Minor network issues can lead to the failure of the payment and sometimes the payment is deducted from one’s account but not received by the receiver accounts.

 Hard vs Soft Digital Currency

S No.	Hard Digital Currency	Soft Digital Currency
1.	It refers to the currency whose transactions can’t be reversed or changed once done.	It refers to the currency whose transactions can be reversed or changed once done.
2.	It is quite similar to a hard copy cash payment system.	It is totally the opposite of hard digital currency.
3.	It is more secure and less friendly in nature.	It is more user-friendly.
4.	The transactions are drawn through the banks.	Users can also manage the transactions after the payment had been done such as inc/dec in payment amount or cancel the procedure.
5.	An example of hard digital currency is Bitcoin.	An example of soft digital currency is dealings through PayPal, Paytm, etc.