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Definition: Digital Currency Exchanger
Digital Currency Exchangers (DCE) allow a customer to convert legal money to digital currency or one digital currency to another. The process is facilitated by a broker who takes the spread as margin for the transaction. Conventional fiat money like dollar or pound can be converted to digital currency like Bitcoins which can further be traded depending on favourable market conditions. After acquiring digital currency one becomes a cryptocurrency holder.
The digital currency exchanger (broker) also acts as an advisor who can advise the investor when and which digital currency to buy based on market trends and statistics. There is also an option to have an e-wallet to hold the digital currency and it can also be used to make purchases elsewhere. The use of wallet should be considered after due deliberation only after checking the security protocols available so as to prevent any attack from hackers.
A DCE can be an online portal or a conventional store, the main crux here is the use of technology and the readiness of the vendor to conduct trade using digital currency. The concept of digital currency is more prevalent in western countries and not in Asian countries like India. The market there is more mature and is willing to take the risk of committing trade in a virtual currency.
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