Updated: Mar 3
So, what do I believe are the biggest barriers preventing mass adoption of cryptocurrencies? In my opinion the lack of knowledge is one of the biggest barriers. There are still many people who do not even know that cryptocurrencies exist, or they have heard of bitcoin but know nothing else about it. However, I do believe that this has already started to change with cryptocurrencies being mentioned in the mainstream news and on social media more and more lately. I also feel that this is an area where the crypto community needs to increase their efforts on educating the public to the advantages of cryptocurrencies vs fiat currencies. I am not saying that the crypto community as a whole is doing nothing to educate the public, what I am saying is there needs to be a concerted effort by the crypto community to combat the negative publicity that is being spread by those in the traditional financial system. There needs to be an effort to change the perception of the general public that it is just too difficult for the average person to participate in a crypto economy.
But there are also people who just do not want to take the time to learn something new no matter how easy you make it for them. Then there are those who are resistant to change, they are comfortable with the status quo and see no need to change. In my opinion these people will be the most difficult to convert into crypto investors – users but I feel with time even they will join the crypto community.
The technological barrier that has existed since the birth of cryptocurrencies is in my opinion another hindrance to mass adoption, but it is now starting to be addressed. Until recently it has been somewhat difficult for the average person to buy and sell cryptocurrencies. Most people do not want to take the time to learn everything they need to know to start investing in cryptocurrencies. Whether it is finding an exchange, how to buy and sell, transferring, or educating themselves about crypto wallets, not to mention all the security aspects. The average person does not want to deal with all of that. Unless there is an extremely easy way developed for people to buy, sell, transfer and store cryptocurrencies, this barrier will always exist. PayPal’s decision recently to offer the buying and selling cryptocurrencies on their website, along with some stockbrokers offering the buying and selling of cryptocurrencies are steps in the right direction but more needs to be done.
I still believe that the mass adoption of cryptocurrencies is possible, but I also believe that it is going to take some time. Progress in that direction is being made but there is still a long way to go.
Now onto the subject of CBDCs. I believe that the development of CBDCs is fine, but they will never address the problem that I believe cryptocurrencies were created to help solve. That problem is the billions of people on this planet who are excluded from participation in the global economy simply because they are unable to open bank accounts. This could be because of their geographic location or their inability to prove their identity. For many of us, it is hard to imagine that there are still 2 billion people on this planet that do not have access to banking. A World Bank study from 2017 found that approximately 1.7 billion people do not have a way to prove their identity which means the inability to access financial services. For the unbanked population, they are relegated to live and work in an informal economy, isolated from the world economy.
This is where bitcoin and other cryptocurrencies can really be life-changing, anyone with a $20 cell phone can download an application onto their phone and basically become a bank. This access to a global, decentralized, borderless peer to peer payment network will open unimaginable opportunities for them. especially for business owners and entrepreneurs where this access will allow them to operate on a worldwide scale. My belief is that this opportunity will change many lives for the better, it will, in my opinion, ignite innovation in parts of the world that up until now have basically been left behind. They will then be able to join in with the rest of us in the global economy that they have been excluded from for far too long.
For the rest of us who have been privileged enough to live in a part of the world where we have easy access to banks and other financial systems, we now for the first time ever have another choice. We can choose to continue to operate in fiat currency dealing with banks who loan out our deposits at exorbitant rates while paying us next to nothing, then charging us fees just for access to our money. Or we can choose to break away from that old system and take true control of our money. But it also does not have to be just one or the other, I believe many people will choose to use both fiat as well as cryptocurrencies.
The biggest threat to any of this happening in my opinion will be governments around the world who are unwilling to give up some control. My fear is that they will do what they usually do and try to control everything so that they do not lose any of their power or control over the people.
In my opinion the biggest problem with CBDCs is that they will be centralized, controlled, and manipulated by the government just as the dollar and other fiat currencies are today. So, I really do not see any benefit from CBDCs for the people who will benefit from cryptocurrencies the most. I do not believe there will be any benefit from CBDCs for anyone other than the governments, who most likely will be able to track transactions and keep an eye on your spending habits. Just making fiat currencies digital does nothing, hell most money and transaction now days are digital anyway, I very seldom if ever carry cash in my wallet.
I hope you found this informative. Best Regards, BigskyCrypto Sources:
Global Findex Study (2017): https://globalfindex.worldbank.org/sites/globalfindex/files/chapters/2017%20Findex%20full%20report_chapter2.pdf