what is digital money 
digital money is any means of payment that exists in a purely electronic form digital money is not physically tangible like a dollar bill or a coin it is accounted for and transferred using online systems digital money generally represents fiat currencies such as dollars or euros it is exchanged using computers smartphones cards and online cryptocurrency exchanges in some cases it can be converted into physical cash using an atm understanding digital moneydigital money is similar in concept and use to its cash counterpart in that it can be a unit of account and a medium for daily transactions it is treated the same as cash for example the dollars in your bank account are digital banks no longer store physical cash for clients when you make a cash deposit to a bank it adds numbers to your account and reissues those bills to other customers if you make a cash withdrawal the bank converts your digital dollars to cash subtracts the amount from your account and gives you physical bills this makes financial transactions much faster and cheaper especially concerning cross border payments and remittances given these advantages digital money has become a priority for several governments around the world for example the central bank of sweden a country that has been researching a cashless society has released several exploratory papers since 2017 that explore the benefits and drawbacks of introducing digital money into its economy 1 china released the digital renminbi e cny the digital equivalent of its national currency and began using it to pay government employees the bahamian sand dollar was introduced in 2020 23digital money makes it easier for central banks to implement monetary policy because they don t need to collect and store physical money or assets to influence inflation or create financial system stability 