A digital currency is a type of currency available in digital form compared to other forms such as the physical banknotes and coins.
Whether the digital currency is centrally issued and controlled or whether it is based on a decentralised system could mean it is a fiat currency or a cryptocurrency. A digital currency may be independent of any other currency or could be linked to or identical to or pegged to another currency or even a combination or basket of other currencies or commodities.
The Lumi (AKL) is an example of a digital currency whose equivalent value is measured relative to the price of 4 grains of gold. This means that even though the Lumi is central issued, its price less susceptible to targeted market manipulation globally since its price fluctuation in the primary market is correlated to the price of gold. However its secondary market price may still be subject to demand and supply conditions driven by the need to use it as a store of value or medium of exchange to drive trade.