Risk in digital currency - management risk, Other Subject

Management risk

DGCs, similar to all financial organization and public securities, have a coating of risk in the type of the management of the issuing organization. Controls intended to bound management riskare called "governance".

GoldMoney is the simply DGC that is a government registered money service business.Reproduce e-gold's success, a number of companies claiming to be Digital Gold Currencies sprang up and unsuccessful between 1999 and 2004, including OS-Gold, typical Reserve and INTGold. All three of these companies unsuccessful because the primary diverted deposits for other purposes in its place of holding them in the type of gold.

In every of the beyond cases, account holders lost more than a few million dollars worth of gold while the "institution" failed. though, the warning signs were obvious from the establishment. All three of the failed corporation were produced and operated by people in the high-yield asset program "business", and the citizens who lost their funds were approximately completely HYIP players. not any of the failed pseudo-DGCs had recognized a governance system to defend the reserves from being pillaged by organization.

In dissimilarity to those prominent failures, e-gold and GoldMoney have both well-known governance systems that present a high level of clearness. E-gold publishes a real-time "examiner" on their website that demonstrate the total amount of e-currency in flow, as well as a list of the gold bars held in trust to back the significance in the accounts. E-gold's governance system is self-certified, significance that there is no third-party confirmation of their available figures. GoldMoney goes a important step additional by publishing quarterly third- party audits of their system all along with a listing of the serial numbers of the bullion bars detained in trust.

There are no exact financial regulations governing DGC supplier, so they work under self-regulation. DGC supplier are not banks and consequently not subject to bank policy that pertain to partial reserve lending. However, DGCs do offer a method for transferring money from one person to one more, and may consequently fall under policy pertaining to currency transactions in some authority.

The Global Digital Currency Association (GDCA), which was established in 2002, is a non-profit organization of online currency operators, exchangers, merchants and users. The GDCA is an instance of the DGC industry's effort at self-regulation. On their website they maintain their objective is to "additional the interests of the industry as a whole and help with combating fraud and other criminal behavior, arbitrate disputes and take action as escrow agent when and where necessary." Of the present DGC providers, Pecunix, Liberty Reserve and eight others have turn out to be members of the organization. It costs one gram of gold to file a objection if you are not a member, and the list of filable criticisms is not exhaustive. Their area name is registered in secret through domains by proxy.

Posted Date: 10/13/2012 3:12:59 AM | Location : United States







Related Discussions:- Risk in digital currency - management risk, Assignment Help, Ask Question on Risk in digital currency - management risk, Get Answer, Expert's Help, Risk in digital currency - management risk Discussions

Write discussion on Risk in digital currency - management risk
Your posts are moderated
Related Questions
The textbook states, “Prejudice by itself did not create American slavery.” Examine the forces and events that led to slavery in North America, and the role that racial prejudice p

Question 1: (a) Knowledge of the stages of child growth and development is believed to be an important aspect for a counselor. Discuss. (b) Using a concrete example, expla

FIRS T VIRTUAL PAYMENT SYSTEM First Virtual Holdings was a company created in early on 1994 to facilitate Internet commerce. The first product present from First Virtual was a

Perform a White test for heteroskedasticity using auxiliary regressions. Attach your results, and write out the form of the test as well as the value of the statistic and its inter

hi,I have completed my project just i would like to check grammer mistakes and sentence structure so could you help me for that?

Carmen Santiago works for a number of businesses as a consultant. She has helped design accounting systems,provided accounting services,and analyzed the financial strength of her

Question 1: (a) Does the Gillick decision help counsellors and therapists to best meet their professional responsibilities to children, parents and education authorities? Dis

Question 1 How was the establishment of Muslim rule at the end of the twelfth century a turning point in India's cultural history? Question 2 Define Tribe. Explain the si

How would two contrasting thinkers respond to question of the role of self-interest in morality? (Hint: Kant and anyone?) When it comes to the issue of right and wrong; individu

some historians believe that the founding fathers missed an opportunity to abolish slavery in the united states was phasing out and establishing and preserving the union took prior