Bitcoin Adoption in a Nutshell: Crypto Education, Application, Security and Regulation Outlook
Crypto adoption, just like the adoption of any other technology used throughout history, is imperative for said technology to survive. Over the years, there were many products and technologies, some of which were even considered highly innovative. However, they failed to survive due to the lack of adoption. Now, cryptocurrencies are struggling with the same issue, and their very future may depend on it.
Let's take Bitcoin as an example. Ever since it appeared, it has been making waves in the financial and tech industries alike. It has the potential to disrupt the current financial systems, and it inspired an entire new trend, which we today know as cryptocurrencies. Inspired by Bitcoin, many altcoins were born, some trying to overtake the number one spot from BTC, others attempting to bring further innovation.
However, many make a mistake as viewing them as individual currencies, when in reality, they should be viewed as open finance platforms. Cryptocurrencies are not just a new form of internet money. Instead, they are the innovative form of money that has the potential to spread around the world and reach the internet-level adoption, which would change the world forever.
The situation regarding cryptos is already completely different than ten years ago when BTC originally appeared. And, while most coins are still believed to be in their infancy phase, they depend on wider adoption in order for the crypto trend to really take off. However, before this can be achieved, there are several areas which need to be further developed, and those include Education, Regulation, Security, and Application.
The Future of Cryptocurrencies Depends on Adoption, and Here is Why
Let's start with Education. The lack of education and knowledge of cryptocurrency is still very much present today, even after cryptocurrencies exploded back in 2017, ensuring that the large portion of the world learns their name. While many have heard about Bitcoin and blockchain, many have missed this crypto revolution entirely. Even among those who did hear about them, there is a massive lack of knowledge regarding what these technologies actually are.
A lot of people tend not to invest if they do not know what they are investing in, which is why there are still so few actual investors on a global scale. While searching for an explanation on what Bitcoin, cryptocurrencies, and blockchain are — users will likely find a technical definition which will not mean much to them, or explain the potential of this technology.
This is why most investors tend to come from the tech sector, as only these people truly understand what cryptocurrencies are, what they can do, and how are they doing it. For everyone else, cryptos are just a new way to send money, which they might not need, as they are satisfied with using the bank.
While the definition of Bitcoin does claim that the coin can be used for obtaining goods and paying for services, this is not exactly true, as there are still very few places where digital coins can actually be used at. In order for cryptos to reach mass adoption, they need to be useful to everyone and to satisfy their needs.
So far, this is not the case, although it may be if the previous entry, Education, can be satisfied. The more people know about something, the more of its advantages become apparent. This will drive adoption among service and goods providers, and as a result, it would provide more application for crypto itself.
The security has been a big issue within the crypto sector, with many trying to accuse it of being filled with criminals, terrorists, money launderers, drug traffickers, and alike. Not to mention the numerous exchange hackings and coin thefts that resulted in hundreds of millions of dollars in crypto being stolen in the last few years.
However, education about crypto may serve to reduce these problems as well. If users understand how important it is to properly secure their private keys, or that they should never hold their coins within exchanges if they can help it, a lot of these incidents could be avoided in the future. The issue does not concern cryptocurrencies themselves, at least not as much, but rather the users' awareness of online dangers and safety precautions.
Finally, there is an issue of regulation, which many believe may be the area that is the main reason why cryptocurrencies cannot achieve mainstream adoption. Most countries around the world currently lack proper regulation for cryptocurrencies, while many of them are trying to come up with a working framework. The lack of regulations is also believed to be the reason why institutional investors hesitate to join the crypto space.
There were several moves made to bypass this issue, such as attempts to receive crypto ETFs approvals. While the regulators rejected most such requests, one had the potential to receive a grant, although that also failed due to the US government shutdown.