The real purpose of cryptocurrencies
People often view bitcoin and other Ethereum as a way to make money fast. However, these assets are very volatile in nature and may notice price increases – or deficits – of several percentages per day for no particular reason. Once valued above $ 69,000, Bitcoin now struggles to convincingly rise above $ 20,000. For many, it seems like a volatile asset suitable only for speculation and nothing else.
However, one cannot lose sight of the bigger picture. The price of BTC is just a small facet in a much larger equation. Countries have begun to embrace Bitcoin as legal tender, making it an effective form of money in regions like El Salvador. It may seem like a “far from my bed” show, but it sets a valuable precedent for other countries to follow. It may not happen overnight, but similar measures could be taken in the developed world over the next few years.
There are many reasons to fully embrace cryptocurrency, even at the government level. Unlike fiat currencies, banks and other financial institutions, cryptocurrencies do not require authorization to be used. Instead, anyone can get them, use them and treat them like money. It is a great boon for both consumers and businesses and paves the way for a sustainable global economy where everyone is on the same playing field.
A bumpy road to progress
As you’d expect, cryptocurrencies have faced numerous struggles in their quest for traditional adoption. While there is no “major” use of cryptocurrencies, the legal tender status in El Salvador and the Central African Republic is the result of tireless work by a global community of supporters and users. However, those victories only came after numerous setbacks, doubts, FUD campaigns, misinformation, etc.
Key issues facing the industry today include:
- Steep learning curve: cryptocurrencies require a fair amount of technical knowledge to be understood. Their use does not require specific knowledge other than the correct software and a way to acquire / convert between fiat and crypto
- Regulation (or lack thereof): Most countries don’t have cryptocurrency guidelines, which makes them seem less reliable. Countries with regulations virtually ban them or are very open. There is no unified legal framework and one is absolutely necessary.
- Volatility: fluctuating market prices make it very difficult to consider cryptocurrencies as “stable”. There will always be concerns when your asset may gain or lose 20% of its value within hours.
Smart people may see these issues as crucial challenges for the industry to overcome. Fiat currencies are also not stable – even their exchange rates can fluctuate wildly – and no global currency is accepted anywhere. Cryptocurrency can still fix that fractured economy with its hundreds of currencies and turn it into a global front where Bitcoin and perhaps a few other assets play a crucial role.
Push the boundaries to achieve mass adoption
Thankfully, several companies have demonstrated broad resilience in addressing these challenges. For example, Radix, a project that brings the full potential of DeFi to the world, has developed a new asset-oriented programming language: Scrypto. It makes life easier for developers, leading to a broader development focus and more products, services and solutions. Additionally, Radix offers unlimited scalability thanks to its Cerberus consensus algorithm, a key aspect in trying to achieve mass adoption.
Convincing people to enter the world of cryptocurrencies remains one of the biggest obstacles to overcome. Applications with “gain” mechanics, such as Walken and its play and practice model, can become crucial gateways in this regard. It’s a way for people to become healthy – a young and old model can embrace easily – and they get rewards for doing so. With over 1 million users, 13% of whom have never touched cryptocurrencies before, the concept continues to attract people. Plus, there are no upfront investment costs, nullifying volatility and regulatory concerns.
Looking beyond consumers, companies and brands should pay more attention to cryptocurrencies and its technology stack. The transition from Web2 to Web3 will prove crucial for many entities. The technology that facilitates that transition already exists, and Snook is a good example of how teams can easily embrace user value. Snook’s new solution facilitates community building and growth through BBT themed rooms, creating a near plug-and-play solution to engage community members while providing value and entertainment.
When people no longer have to think about using special software to interface with cryptocurrencies and blockchains, traditional adoption will happen organically. Despite the industry obstacles to date, progress continues to be made and new efforts are in the pipeline. It’s about “when” rather than “if” until cryptocurrencies become part of everyone’s daily life.