A digital currency is one that is not issued by any government, but is instead created from computer software.
It can be used as a means of payment to merchants who choose to accept it, and is also used as an investment by those who believe that digital currency is the future of the global economy.
Unlike traditional currencies, digital currencies have no physical representation, and retain their value based on the willingness of people to use them as a store of value or means of transaction.
Digital currencies can be said to have their origin in video games, where players would buy and sell in-game items with fiat currency offline.
The very first digital currency that was pegged to the U.S. dollar is known as the Project Entropia Dollar, or PED, and is used as a currency in the game Entropia Universe, but can also be exchanged for fiat currencies. The very first blockchain based digital currency was Bitcoin, which was first mined in 2009.