Virtual currency is an electronic form of value that is capable of being digitally exchanged and serves as an advertisement medium. It does not have the status of legal tender in any jurisdiction; it is not issued and is not guaranteed by an ant jurisdiction; and it only fulfills the functions outlined above through agreement within the collective of users of a virtual currency.
Virtual currencies that are convertible or non-convertible have the same value as real money and can be used to exchange it back and forth. However, this doesn’t mean that they can be converted without a market, like on the gold standard. For example, Bitcoin and Linden Dollars are convertible. Non-convertible virtual currencies are only used in certain virtual worlds, like MMORPGs, and they can’t be exchanged for real money. Examples include Project Entropy Dollars and Qcoins.
E-money is basically a digital version of a regular currency used to send money around electronically. It’s a digital way to transfer money that has the status of a legal tender. Examples of e-money include paypal, cashU, webmoney, and Liberty Reserve (now gone). Virtual currencies, on the other hand, are either run by a Virtual Communit operator or by a community of Virtual Currency users and don’t involve any fiat currency at all. Examples of virtual currencies include bitcoin, Litecoin, and Namecoin.
There are two main types of convertible virtual currencies:centralized and decentralized.
-Centralized means that the system is managed by a single, centralized administrator. Examples of centralized virtual currencies include e-gold, Liberty Reserve, Webmoney, AmazonCoins, etc.
-On the other hand, decentralized virtual currencies are those that are distributed, open source, mathematical, peer-to-peer, and have no central administrator. Examples of decentralized virtual currencies include Bitcoin, Litecoin, etc.
A non-transferable (or closed-end) virtual currency is a type of virtual currency that is exclusive to a specific virtual domain or world, such as a MMORPG or Amazon.com. Under the rules governing its usage, it cannot be converted into fiat currency.
Examples include: project entropia dollas, Q coins, and World of Warcraft gold.
-Crypto Currencies are decentralized digital assets that can be securely stored in a public ledger known as a blockchain.
-Setting up a Crypto Currency wallet is simple and straightforward, with minimal transaction fees.
-Additionally, Crypto Currencies are anonymous, transparent, and fast.
Bitcoin is a digital cash and online payment system that operates independently from a central bank, utilizing encryption techniques to regulate the generation of units of currency and validate the transfer of funds. It is distinct from other digital currencies in that it is pseudonymous (non-anonymous) in that public key addresses are used to transmit and receive Bitcoin, as well as to record transactions, rather than personally identifying information.
They are created by transactions between buyers and sellers word-for-word.
Each transaction must be approved by a “miner” who is independent of both buyer and seller.
Once approved, the miner links the transaction to other approved transactions until it has enough to add it to his “Blockchain”.
Each miner is rewarded with a Bitcoin when they add a block to their blockchain.
Quark is a secure cryptocurrency that utilizes nine rounds of cryptographic hashing from six different algorithms. It is considered to be particularly secure, and has a market cap of $30 million. Other popular cryptocurrencies include Primecoin, which is the first cryptocurrency to have a non-hash cash Proof-of-Work and is limited to 42 million. Other popular currencies include Feathercoin and Megacoin, each with a market cap of up to $26 million.
Crypto and related tech have a lot of potential for connecting people all over the world thanks to their low cost, fast, and verified transactions. That’s why they could be attractive to some terrorist groups.
For example, the Gaza Strip’s terror group has been using Crypto to fund their activities.
And there have been reports of Crypto being used by ISIS members and supporters in places like Indonesia and the US.
The following are selected examples of terrorism using cryptocurrency:
Haaretz reports the first use of Bitcoin by the terrorist group ISIS in the black market. Supporter Abu-Maftafa was able to acquire five bitcoins (about $1,100) before the FBI shut down his account.
Indonesia’s Financial-Transactions agency reports the use of Bitcoin and other online payment services by Islamic militants across the Middle East for financing terrorism in Indonesia.
In the past year, we’ve seen a lot of cases where people have been convicted of helping the IS (Islamic State) by providing material support and money.
One of the most recent cases was Ali Shukri Amin. Amin was convicted of conspiring to provide IS with material support, money, and other resources. He used Twitter to talk about Bitcoin and how to use it to hide money sent to IS. He also talked about setting up a secure system to help people travel to conflict areas with supporters and foreign fighters.
He even wrote an article about Bitcoin and how it could be used to help Jihadis. Even though Amin didn’t do a great job at raising money for IS, it’s a sign that terrorist groups are always looking for new ways to get money. The Amin case is a clear example of how they’re trying to use Cryptocurrency for operations, funding foreign fighters, and spreading disinformation through social media.
Following the introduction of the Bitcoin donation option in June 2016, approximately 0.929 Bitcoin (about $540) was received in two separate transactions in July 2016 by the media wing of a Salafi-jihadi group in the vicinity of Jerusalem.