For us who have been observing crypto for a while, its stagnation as a marginal asset can get frustrating, and quite frankly, incomprehensible. The world is already moving towards a mobile, paperless and cashless society and crypto seems to be the perfect
medium for this transition. People have mounting concerns about the world’s economic and social order, and crypto could be an answer to the millions of underserved and neglected in our society. Still, crypto remains relegated to a few circles of hopefuls and
evangelists. What are the true barriers to crypto’s
mass acceptance, and will they ever be surmounted?
Early Products are Causing Confusion
Blockchain used to be touted as a solution against invasion of privacy, and was supposed to provide anonymity and security to users. But since then, we’ve realized that cryptos were not as private as we once thought. After all, there would be no need for
privacy coins if certain coins didn’t present privacy issues. To date, only about a hundred cryptos promise real anonymity. And we’ve all learned from the BitConnect debacle that they’re not totally safe either.
The BitConnect event may have been a sad joke to many insiders, but it did leave a sting in a portion of the population. Trying to get into a
rogerian argument with someone who is not familiar with cryptos and convince them that they’re not a scam will be hard when this was their first interaction with them.
This is another argument that will make the average insider roll their eyes, but the spectre of crypto fueled criminal or even worse, terrorist activity is still very real. And quite frankly, it is partly true. But fiat currency presents many of the same
risks. More will have to be done to erase that stigma for crypto to truly rise.
Too Many Coins
There are over 2000 cryptos out there right now with a market cap of over 200 billion dollars. Forget the dizzying valuation; the gross number of cryptos is what we should be worrying about.
From the outside looking in, trying to make sense of all of these coins can be a nightmare. Not to mention that there is basically a coin for everything nowadays:
music distribution, power and energy, manufacturing and agriculture, the list goes on. The steep learning curve could be a deterrent to many would be investors.
This is probably one of the biggest barriers to mass adoption for cryptos. Or should we say, purely decentralized and ungoverned cryptos like Bitcoin.
These coins will always be at the mercy of supply and demand, and were made this way by design. While this may be a great selling point to those who want a decentralized system that benefits the user first, this is also a nightmare for the average merchant.
Either viable solutions (we’re looking at you lightning network) to allow merchants to know how much their bitcoins are going to be worth at the end of the day will have to be introduced, or a coin with an accepted and trusted governance system which would
allow for some sort of centralization or control.
Will crypto ever break out? Probably. But it’s not going to happen tomorrow. Crypto still has some significant barriers to entry, kinks that need to be straightened, and lots of PR to do.