Digital currency is continuously gaining new ground. Especially within the blockchain community that so heavily supports the decentralization of financial institutions. Many enthusiasts around the globe advocate that cryptocurrency is the wave of the future and will soon make fiat currency a thing of the past.
The reasoning behind making cryptocurrency the only currency deals with a lot of mistrust in the financial institutions as well as the high prices for exchanging between countries. Even with advanced technologies that have surfaced, which enable people from all walks of life to enjoy the freedom that comes with using digital currency for daily transactions, there are still some issues that arise.
For some, they wonder if the digital currency is appealing enough for the average person to adopt the new system. For others, the question of whether using cryptocurrency for everyday uses is ideal. No matter which way one looks at, there are still serious barriers to breach before digital currency can take hold. After all, when you look back at 2016 when the popularity of Bitcoin was at an all-time high, people believed that it would sweep through and replace fiat currency. Yet, here we are in 2018 and still no sign that the cryptocurrency prophecy of being adopted by the masses has taken place.
So what's the holdup?
Just a Few Factors to Consider
It's not surprising that there is a psychological barrier that needs to be broken before digital currency will become mainstream. But, that is not the only factor, there is also the technological aspect of cryptocurrency, as well as utilitarian. As of now, the perception of digital currency is the same way a comic book collector would value a mint condition #1 Batman comic book. The idea of holding something valuable without using it just for the sake of owning it rather than to use it as it was intended.
Of course, the other side of the coin is the technological aspect where everyday people don't have enough information about the digital currency to give it clout and adapt it to daily living.
So What can be Done?
There is no denying the fact that cryptocurrency has come along way from its conception. However, there is still a long road ahead if we are to adopt the digital currency as the standard means for transactions. The general consensus states that to have cryptocurrency used in everyday life 6 things need to happen.
The fact is, no one is going to want to use digital currency until they fully understand how it can work for them. Because there is not enough information available, a lot of people are still stand-offish about using the currency. However, some countries are educating their population to be better aware of cryptocurrency. The United States colleges NYU and Standford for example now offers college courses in cryptocurrency to allow their students to become fully aware of digital currency and how it can be applied to everyday life.
However, several countries are still far behind and have yet to get caught up in the digital world. But through educating the masses, people will be able to realize the potential for the cryptocurrency.
#2: The Gate Keepers
For cryptocurrency to take effect and become the standard means for transactions, the governments, investors, and banks around the globe would need to get on board. However, several countries don't trust the idea of digital currency and have banned the use within their borders. To get past this, countries like China, South Korea, and the UK need to be educated on the potential of cryptocurrency. Yet, because money is power, being able to control the currency keeps the gatekeepers in charge of the population.
Yet, other countries such as Japan, the United States, and Switzerland see the potential for using digital currency and have opened their arms to the possibilities of using the currency.
The only way for people to get on board with using cryptocurrency is if those in charge show the population the benefits of using it. Until that time comes, the world will be divided by those who use it, and those who don't.
#3: The Ecosystem
The fact that the high volatility of digital currency keeps investors on their toes and forces them to watch the market closely is a cause for concern. No one wants to put their money in a losing horse. But due to the nature of the market right now, that is what happens when you invest in digital currency.
Since the market is unregulated by any authority, there have been issues and reports of people being hacked. Since there is no one in place to investigate or any means to get the stolen goods back, those hacked are forced to deal with it. The fact that this is not a single occurrence causes concern.
For a digital currency to be adopted by the masses, there must be a stable ecosystem. Utilizing a stable ecosystem is easier said than done. With the currency in a constant state of movement with prices spiking and falling, people, in general, won't want to be pestered with the worries of whether or not their money will have any value the next day.
It also doesn't help that businesses who deal with cryptocurrencies inflate their fees to compensate and hedge their risks. When you look at Bitcoin ATMs, you will find that they charge a staggering 15% to convert the digital currency to fiat. The charge defeats the purpose of digital currency.
#4: Everyday Uses
Cryptocurrency was created as a means to dissolve the middleman when it comes to paper money and banks. However, due to lack of understanding, it has not taken off the way it was predicted so many years ago. On the plus side, specific industries realize the positive impact of cryptocurrencies and are making leaps and bounds. One such sector is Healthcare. With so much information dealing with doctors, prescriptions, diseases, and insurance, the Health industry is looking at blockchain technology for patients so that all the information is in one localized placed ready to be accessed.
#5: The Exchange Marketplace
The marketplace has been established. However, the issue falls back to security. Without any regulations or security in place, there is no telling if an account will be hacked and the funds lost. To deal with this issue, governments, investors, and those that create digital currencies need to convince people that their funds are secure and safe. The only way to do that is by establishing some ground rules and legitimacy on the marketplace.
#6 Rules and Regulations
Cryptocurrencies value independence and a decentralized economy. However, without regulations and rules to follow, the system is bound to have security risks. These risks are where we are today. Unless the government, retailers, merchants, and citizens make a clear stand on owning, trading, and selling things will continue to be out of balance. There must be some consequence for hacking other people's accounts just as there is for someone breaking into a bank and stealing money.
While the crypto market has made some serious leaps and bounds over the last five years, there is still so much that needs to be done for cryptocurrency to take the main stage. But unless these six issues are addressed, digital currency like Bitcoin, Ethereum, and Litecoin are just going to be a novelty for investors.
Yet, with the proper education and regulations set forth with the full support of government officials, cryptocurrencies could finally replace the broken financial institutions that are in place now.