1. The e-currency can be used on the internet related commercial applications such as shopping on the internet and doing personal investment via internet.

2. The using of the e- currency services for example e-gold and PayPal brings people a new way not to use their credit card as the only payment method on the internet since sometime there exists a big risk to provide your credit card information to the merchant you do not know them very well and most of them are far away in the other side of the earth.

3. The e-currency service companies such as e-gold and PayPal can provide both the buyers and merchant the convenient way to send and receive the payment just by clicking the confirm button and the deal is done. None of the payment methods in the world right now can provide this kind of efficiency capability.

1. The user is anonymous unless he commits a double expenditure.

2. The bank can effectively detect a double spender.

3. The bank doesn't need to synchronize its servers very often. This is mostly done via batch updates.

1. Security and anonymity cost become a bottleneck of the system. This can happen at times during real-time verifications.

2. The bank will have to maintain a detailed and confidential database.

3. The bank needs to synchronize its server every time transaction is made. It would be insanely impractical to maintain.

1. Double spending may not be prevented effectively and immediately.

2. The implementation expenditure is high. The required additional hardware is quite costly to install.

There are two major types of e-currency in the world. The major different is their backed base.

One is backed by precious metal such as e-gold is backed by gold.

Another type of e-currency is backed by hard currency like Paypal.

Both of them are all called e-currency. Digital Gold Currencies (DGCs) are a form of Internet money denominated in gold weight. The typical unit of account for such currencies is the gold gram or the troy ounce, although other units such as the gold dinar are sometimes used. Due to its rarity and durability, gold has long been used as a means of payment. The exact nature of the evolution of money varies significantly across time and place, though it is believed by historians that gold's high value for its utility, density, resistance to corrosion, uniformity and easy divisibility made it useful both as a store of value and as a unit of account for stored value of other kinds.

In several countries there is electronic currency equal to real paper money. This kind of currency is very easy in use and it does not need any bills, checks or other bank documents. The main advantage of such money, comparing with its real equivalent, is very low costs of transactions, especially inner (from one account to another). These low costs allow using e-currency for small transactions where usual cashless funds are not comfortable. This plus during time becomes more and more important.

One rare success has been Hong Kong's Octopus card system, which started as a transit payment system and has grown into a widely used electronic cash system. Singapore also has an electronic money implementation for its public transportation system (commuter trains, bus, etc), which is very similar to Hong Kong's Octopus card and based on the same type of card (FeliCa). There is also one implementation in the Netherlands, known as Chipknip.

The Octopus card is a rechargeable contactless stored value smart card used to transfer electronic payments in online or offline systems in Hong Kong. The Octopus card is also used for payment at convenience stores, supermarkets, fast-food restaurants, on-street parking meters, car parks, and other point-of-sale applications such as service stations and vending machines.

Making or recording a payment using the card for public transport or purchases at Octopus-enabled retailers can be done by holding the card against or waving it over an Octopus card reader from up to a few centimetres away without the user taking out the card. The reader will acknowledge payment by emitting a beep sound, and display the amount deducted and the remaining balance of the card.

In Malaysia, the first attempt at e-currency implementation was in 1999 with the introduction of MEPS cash in the Klang Valley. The initial response was not encouraging at all. The facilities to reload the cards with cash was limited, the outlets where MEPS cash was accepted was also few in numbers. However, the situation is quite different today where almost every ATM machine in the country is equipped with the ability to reload MEPS cash.

Another effort in implementing electronic money in Malaysia came in the form of the Touch and Go cards offered by Rangkaian Segar which is a private company. Touch ‘n Go cards were originally intended for toll payments along the Malaysian highways. The cards may either be linked to ones credit or bank card with automatic reload facilities to a stipulated maximum level once the amount on the cards fall to a predetermined minimum level. The cards may also be reloaded at some of the toll booths or at some banks ATM terminals. Despite the availability of these cards, it is not surprising to find long queues during peak hours along the cash booths along the local highways. Nevertheless, it is interesting to note that today the Touch ‘n Go cards are also used for other payments such as parking bays and train and bus fares.

As the allegro expansion of internet economical applications, the using of e-currency will be the trend in the coming future just like credit card application before. But however there is no unified definition to the e-currency service industries .For example ,Will we define a e-currency company as the bank service or just a financial service firm ? This question remains gray area.

Related Links:
1. http://en.wikipedia.org/wiki/Electronic_money

2. http://projects.exeter.ac.uk/RDavies/arian/emoney.html

3. http://www.persiox.com/2009/04/methods-of-using-perfect-money.html

4. http://www.digitalibrary.my/dmdocuments/malaysiakini/266_20Dr_Balachandher.pdf

5. http://www.buzzle.com/articles/advantages-and-disadvantages-of-electronic-cash.html