Working in this industry, it’s easy to feel as if everyone’s in the know about blockchain technology and cryptocurrencies. In reality, that could hardly be further from the truth.
Take Bitcoin as an example. With around 50 million users, less than 1% of the world is invested in it. Yet, with major institutions entering the market, what’s still missing for the mass adoption of blockchain tech?
Trust remains an issue
It’s somewhat ironic that one of the major issues with using a trustless transfer of value is the inherent lack of trust that people have in cryptocurrencies. Bitcoin, with its early associations with the Silk Road and the ICO mania in which many people were duped out of their investments, somewhat tarnished all cryptocurrencies with the same brush.
Then there are the constant and highly publicised hacks possible even on exchanges like Binance. And let’s not forget the horror stories of the alternative – keeping your own funds in a hardware wallet and losing the backup seed (and access to your crypto fortune forever).
While the “blockchain not Bitcoin” movement began with companies disassociating themselves from the frowned-upon crypto (while running pilot schemes with the ledger it runs on), the criminal association remains strong.
Governments around the world are undecided how to best approach this new technology. We’re seeing forward-thinking countries like Malta and Switzerland go all-out to create a legislative framework for crypto companies to work in. Meanwhile, other countries are making it as hard as possible for blockchain start-ups to, well, start-up.
The unyielding power of the banks
Without realising, through centuries of indoctrination, people are automatically trained to place their trust in a bank – even though banks have been the perpetrators of many a global crisis and taxpayer bailout. It is banks that charge people 20% to borrow money on credit but give them back only 1% (or less) on their savings. It’s banks that charge massive commissions, transaction fees, and forex fees.
Yet, until there is sufficient validation from the very institutions that blockchain was created to sidestep, we’re still a long way from mass adoption of blockchain tech.
However, little by little, that’s starting to change. CEO of Rublix Development David Waslen – quoted in blockchain marketing firm Zage’s recent report titled Real World Applications of Blockchain Technology – observes:
“I think blockchain-based, P2P financial services including social trading platforms, lending services, and payment processing all stand to see massive growth. We are already seeing growth in the blockchain industry with banks and other large enterprises that handle a lot of transactions, such as online marketplaces and social media giants with massive user bases.”
His sentiments are backed up by Jackson Zeng, COO of digital currency brokerage Caleb and Brown (quoted in the same report). He says:
“In terms of pure size, the biggest opportunities would certainly lie within the banking sector. That industry is going to transform this decade in a big way, and along with it, the registration of assets will migrate almost entirely onto the blockchain.”
Already, large names like Goldman Sachs, JP Morgan, ING, and the Bank of China are working with DLT. This can only increase the mass adoption of blockchain tech (whether the people know they’re using it or not).
The lousy UX is the biggest deterrent right now
The Zage report interviewed 102 major players in the blockchain space, including thought leaders like Tim Draper, technology experts like Litecoin’s Franklyn Richards, and multiple CEOs, COOs, and developers around the world. According to the report, these are the people on the front lines, “creating real value for the blockchain community and new convenience and value for mainstream consumers all over the world”.
One of the major findings of the report (despite the fact that the questions were open-ended) was that a massive 41% of respondents felt that the lousy user experience is getting in the way of mass adoption of blockchain tech right now. Until the UX becomes as simple and easy as web and mobile, we’ll have trouble onboarding new users to the decentralised web.
Who will benefit most from mass adoption of blockchain tech?
As per the report’s findings, around 10% of respondents conceded that the developing world with problematic fiat currencies, unreliable (or unavailable) banking, and frequent devaluations of their national coin may benefit most from mass adoption of blockchain tech.
The fact that people can send funds without a bank account and save enormous amounts on remittances is a game-changer. General manager at Brave New Coin Adam Dodds remarked:
“BitPay appears to have gained excellent traction in developing regions of the world, which tend to have crude financial systems, where the public, accessible, and digital nature of blockchain tech has real value. Similarly, in the Remittance sphere, the digital, automatic verification of a blockchain-based payment network appears to have value versus legacy tech, but deployment costs have affected how much it is actually being used.”
Mass adoption will come, but it may be a silent revolution
While some people believe that Facebook’s Libra may be the catalyst for millions of users to start using blockchain tech, the revolution may take place without creating so much noise. It’s more likely that blockchain tech will simply begin to assimilate into the lives of users.
In fact, in some cases, it’s already happening. To use the words of Tim Draper:
“People are already using blockchain in everyday life. The blockchain is just a perfect ledger. It keeps perfect information on Bitcoin use, and it keeps perfect information on any other form of data, too. It is being used to secure data for everything from medical records to certification of education.”