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The Top 5 Barriers to Mass Adoption – And How to Overcome Them

mass adoption

You can’t write an article about crypto without mentioning the latest market massacre. That would be like not talking about the elephant in the room. Many people in the industry are still too new to remember Bitcoin’s many bubbles. Yet this latest one is so epic because of the amount of money bleeding out. But is there a light at the end of the tunnel? Could bitcoin’s plummeting price hold the key to mass adoption?

Let’s take a look at the various factors getting in the way of mass adoption and how a lower price–along with removing these other obstacles–could be the trigger to crypto’s recovery.

1. Volatility

This time last year, Bitcoin was approaching its all-time high of almost $20,000. Now it’s flirting with $3,000 with some analysts calling for a low of $1,500. That’s a staggering drop by anyone’s standards.

Bitcoin Price

While there’s every possibility that the price will skyrocket back up again, such fluctuations are not for the faint-hearted. They’re also not suitable for use as a currency.

Plenty of stablecoins are in the market which may eventually leave Bitcoin behind as an everyday exchange of value. But they won’t make Bitcoin redundant. In fact, its plummeting price could be the catalyst that brings in the real money.

No professional investor is going to buy when the price is inflated by speculation. When there’s blood on the streets and institutional investors start to buy, the low price will mark a milestone for mass adoption.

2. Usability

Even if you go for a generally recognized easy-to-use exchange like Coinbase, it’s still no walk in the park. In a society that’s used to contactless payments or paying with a smartphone, walking around a store waiting for a transaction confirmation is taking a backward step.

We’re getting better at it, with cryptocurrencies like Dash claiming industry firsts and allowing instant payment confirmations. But there’s still a long way to go. 42-character addresses have to be replaced by names. Clunky hardware wallets that need lengthy configuration are going to get thrown out.

Unfathomable interfaces of decentralized exchanges will need to be tailored to a lay market. They’ll have to go mobile–without 5,000 hoops to jump through before customers can log in.

3. Scalability

How to scale blockchains for mass adoption has been the question on everybody’s lips especially since 2017 saw CryptoKitties crash Ethereum and the Bitcoin blockchain get so backed up that transaction times went through the roof.

The Lightning Network is making good progress despite the downward turn in price.

lightning-network

Source 1ML.com

Ethereum too is working hard on scaling solutions like SNARKs and the plasma protocol. Plasma will essentially allow hundreds of thousands of transactions to happen off-chain enabling mass adoption and speed without clogging up the network.

A few companies are working on incorporating plasma into their technology stack. Digitex Futures, for example, as a hybrid exchange, will use the speed of centralized servers for matching orders and plasma technology to offer decentralized account balances.

4. Regulation

Many people argue that regulation will stifle innovation. But the big banks and institutional investors simply won’t get on board until they know they’re operating within the lines of the law. Goldman Sachs and JPMorgan have had their fair share of working against market interests, yet crypto still somehow needs their seal of approval.

More exchanges that offer both derivative and spot trading are going to start appearing. In fact, the launch of ICE Markets’ Bakkt in January 2019 is causing a stir throughout the community.

As a regulated ecosystem for global assets with a US-based Bitcoin futures exchange, Bakkt is likely to bring in the big players. This means the stocks and bonds sitting in paper contracts will migrate to the blockchain and the market cap will leap to incomprehensible heights.

When valuable industries such as futures move to the blockchain, we’ve already seen how profitable that can be. CME saw its daily volume increase by 93 percent in Q2 2018 after introducing futures.

Bakkt will also open the door for smaller futures exchanges like Digitex to allow retail traders to make living trading derivatives on crypto.

5. Security

We’re talking about cybersecurity here, not the ongoing debate about security versus utility token. The US SEC and UK FCA are stepping up their efforts to prevent ICO scams. Custodians and exchanges continue their game of whack a mole with the hackers. But until the security of funds becomes, well, more secure, users won’t want to risk losing all their funds to an exchange hack.

2019 will see crypto insurance providers coming to the market, although the process is a complex one. Understanding the risk associated with being a cryptocurrency custodian or with futures trading on a volatile market like crypto isn’t easy.

The Barriers to Mass Adoption Are Being Worked on

When institutions are comfortable being in the space when providers can offer some kind of insurance, regulation gets it right, and bitcoin price gets low enough, the sea change will surely begin.

All these barriers to mass adoption are being worked on regardless of the lowering prices. The bear market is allowing developers to push out the products that will lead to mass adoption of crypto. It’s just a question of when.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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