Regulations, lobbyists, lack of trust in governing bodies, banking infrastructure, etc. – these are all elements and factors that contribute to crypto mass adoption, but sadly these are also the things that currently hinder it. Nevertheless, the road to adoption is coming, and the interest of decision-making parties has substantially increased in the past couple of months, especially with regulatory authorities like SEC and parliaments across the world looking deeply into how blockchain applications can make life easier for themselves, and ultimately the masses – although there is always an opportunity cost behind the decisions being made.
Before crypto was seen as a method for money laundering, ransomware, terror financing and other illegal activities on the dark web, so first impressions of the application of this new digital currency wasn’t great. But the actual objective behind the creation of bitcoin was to develop a decentralized economic front on the global scale. Due to its volatility, however, common users started treating it more like a commodity, not a currency. Given this treatment, regulatory bodies could also be able to compare it to gold, and in some ways, packs of cryptocurrencies can even be treated as Mutual Funds, and specific ones as ETFs – targeting both the retail, and institutional fronts.
There’s one problem though if they need to regulate these cryptocurrencies, what are they going to start with? The All-father – Bitcoin. Some people assume that this would be great, and others not as much:
- Regulating Crypto Negatively: These people think that regulating crypto might mean that these governments might introduce certain policies that would turn these cryptos into none other than the infamous black hole: Centralised Digital Currencies.
- Regulating Crypto Positively: These people reckon that regulations will enforce real crypto assets, and built the trust of some institutional investors – looking into some big crypto projects like Libra and finding ways of regulating this asset with regard to the privacy and zero illicit activities would be their goal.
Eric Benz, Changelly’s CEO believes that “Regulators play a massive role in the effort to achieve crypto mass adoption.” Furthering his point by saying that “the wonderful thing about this technology is that it provides more visibility and transparency between multiple types of markets, especially when it comes to a financial activity and data management.”
Complementing the Regulating Crypto Positively aspect seen above, he suggests that “if each regulator in every country in the world agreed to create a layer on top of bitcoin, and each one of them ran a node they would be able to validate and monitor transactions taking place on a global scale.” This point has some benefits, mainly giving the ability for regulators to technically monitor payments in real-time, therefore, and how Eric states it is, “solving one of the biggest issues right now, AML.”
This newly developed institutional interest in crypto, and how it can work in the masses act as a good step forward. Regulating bodies as the CFTC has even classified crypto under ‘commodity and currency.’
Apart from regulations, when people in the industry discuss what holds cryptocurrencies back from mass adoption, the clear focus is its limitation in usability. Currently, there aren’t many retail (both online, and offline) outlets that accept crypto as payment, mostly because of the transaction times being pretty slow depending on the platform, and them not being particularly user-friendly. Nevertheless, while the payment aspect is very important, it is to a certain extent manageable and relatively easy to fix – the real challenge of full-on crypto mass adoption is that people don’t understand it, and if people don’t understand something, they fear it.
People are afraid that crypto is volatile, and people are confused due to its big learning curve. Nevertheless, Eric believes that “crypto mass adoption is something that will only come with time and education.”
The crypto and blockchain cycle is no different than any previous technology cycle over the years. Complementing the confusion aspect, Eric continues on by saying that “crypto mass adoption is taking longer than anticipated due to the fact that money is something that is difficult to let go of, for centuries, generation upon generation people have been taught to value every penny we make. Hence, money to everyone in the world is tangible, with very specific utility and purpose.” Although to be fair, it doesn’t help that currently, crypto is in a bear market, but that can be seen as a good aspect. Weeding out all the scam-coins, and keeping the real crypto-heroes, helping them to continue to develop is a good thing for the future.
Many people discuss that if crypto had to be adopted within an industry first, which industry would that be? Eric had some thoughts on this, and said that “the industries that will adopt the technology and utility of crypto first, will be those industries dealing the most amounts of friction.” And he’s right, the same thing happened with normal people, during the recession back in 2008, there was a lot of friction across the globe, and people believed that governments were not worthy enough to decide the value and weight of their wallets and decided to look elsewhere in value, that helped in the birth of Bitcoin.
Eric continues on by saying that, “the industries he identifies as being the first to adopt crypto would be those in financial services, supply chain finance, and identity management”. He follows up by saying that, “it is imperative for these industries to adopt this technology in order to provide services to new markets and lower their current operating costs.”
To conclude this article, you must ask yourself, are you ready to throw all your FIAT money down the drain and join this movement? Probably not, mass adoption isn’t here yet, and it’s ok. One must live in the present, but one must also think of the future. Eric finished his thoughts by stating that, “this is going to be a long term process, and the only way we will get there is to continue to educate and provide more innovative tools to make living life more efficient and intuitive, all with crypto.