Digital Currency vs. Cryptocurrency

MISBLOC explains the major differences between the two types of virtual currencies

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MISBLOC

2 min readDec 21, 2020

MISBLOC (Medical Information Service with Blockchain) is a medical service ecosystem which is based on blockchain technology. MISBLOC offers a sustainable and efficient medical service ecosystem by providing reliable medical information to patients, medical institutions, and public institutions in the Big Data era.

Hi there! In today’s post, we are going to introduce two different types of virtual currency which are sometimes confused by those who use and operate them. The two types of virtual currency are known as digital currency and cryptocurrency. These two almost identical terms may sound quite similar, but there are fundamental differences that are attributable to each of them and specify their purpose of usage.

Digital Currency vs Cryptocurrency

Cryptocurrency / Crypto asset

A digital currency created with Cryptographic Technology (CT)
General P2P transactions are executed with the exploitation of blockchain technology (encryption, decryption processes)
Decentralization-oriented with the presence of compensations for each block verification.

Virtual Currency

A currency that is used inside of a specific, network-connected virtual space, without a real utility purpose similar to fiat or coins
For example, Cyworld Dotori (virtual currency), Points, In-Game Money, and other types of intangible assets that are connected to a single network
In fact, Cyworld’s Dotoris cannot be considered a cryptocurrency because they are not based on blockchain technology

Virtual Asset

The FATF uses the term “virtual asset” to identify a digital representation of value. It can be traded in digital form and used for payment or investment purposes, including as a medium of exchange, unit of account, and/or store of value
Since the passage of the Act on Reporting and Using Specific Financial Transaction Information, most cryptocurrency exchanges and crypto-associated companies started referring to and attributing cryptocurrency to an official category under the name “Virtual Asset”

Digital Asset

Virtual assets, the legal term for referring to cryptocurrencies, are sometimes also referred to as Digital Assets.

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