How cryptocurrencies could achieve widespread adoption – Today, many people own bitcoin; however, not everyone. In the last decade, this cryptocurrency has gradually gained ground in the financial markets and various institutions. Many countries have been exploring the remarkable potential of bitcoin, including fast, accessible and cheaper payment systems, international money transfers and much more.
Although there is already a long list of things you can buy and activities you can do using BTC, its unique uses have not yet reached all parts of the world. To achieve widespread bitcoin adoption, several critical factors need to be carefully examined and considered. But before we delve into some of those vital factors, let’s look at the state of bitcoin adoption today.
The bitcoin adoption rate in 2020
We are slowly moving towards a digital world where paperless transactions are the new normal, including fiat money converted to digital currency and cryptocurrencies like bitcoin. Cryptocurrencies are becoming more popular nowadays, and many people are trying this ingenious form of cash.
During the early years of bitcoin, the digital currency received much feedback from different industries and jurisdictions. Some were open to the idea, but others found it challenging to grasp and consider as a long-term asset. After more than a decade, people in various countries are slowly accepting the powerful applications of cryptocurrency, hence the likely growth in the adoption rate of bitcoin.
Recent data from Statista shows the prevalence of cryptocurrency ownership in different parts of the world. Major countries that hold and use bitcoin and other digital currencies for remittance and other payment transactions include Nigeria, Vietnam, and South Africa, to name a few.
Let’s see as an example some industries and businesses that accept BTC as a form of payment. Significant companies in sports and entertainment, automobiles, food and beverage, technology, banking and finance, and other industries are beginning to accept bitcoin as a form of payment for their products and services.
From plane tickets and hotel accommodations to pizza, fancy cars, and even a trip to space, you’d be surprised at the things you can do with bitcoin. Thousands of online cryptocurrency exchanges and markets are also springing up. This shows that a large part of the world population has realized the true power behind bitcoin.
Critical factors for mass adoption of bitcoin
To make the bitcoin adoption curve even higher, some essential factors must be considered. Let’s see what some of these are.
1. Legal and regulatory concerns
With the unique characteristics of bitcoin, cryptocurrency is becoming an effective means of reaching the population with little or no access to banking services. However, this revolutionary goal continues to be hampered by some legal and regulatory issues that vary by jurisdiction.
The BTC has a decentralized character, but the countries’ government and central banks continue to have authority over the legalization of cryptocurrency assets. Although it is becoming more accepted in larger cities and nations, some remain sceptical. This is why a country’s central bank or financial institution plays a vital role in adopting bitcoin widely.
Countries like Estonia, Japan, Singapore, Germany, Switzerland, and the United Kingdom are some of the many bitcoin-friendly countries where people can freely hold and spend their BTC. However, some countries like Saudi Arabia, Qatar and others prohibit the use of bitcoin in their territory.
2. Utility value
Making payments, transferring money, and investing in the markets are just some of the uses for bitcoin. Even today, no one can say whether or not this dominant cryptocurrency can replace government-issued money in the future.
For example, transferring money with bitcoin is much cheaper and faster than fiat money. On the other pointer, there are still some limitations to transacting with bitcoin, especially in countries where traditional banks and other money transfer companies are still the primary means of sending remittances.
Since BTC is not yet accepted as a form of payment globally, direct costs and purchases will remain limited.
3. Technological capacity
Bitcoin is a digital currency that works and operates through powerful technology. Acquiring it (mining) requires high-powered equipment, a reliable Internet connection, huge digital storage space, and high levels of electrical power. These requirements have been a problem in some countries, significantly with the increase in energy consumption due to mining.
Apart from mining, accessing bitcoin can seem challenging and complicated for some people. Buying, storing, and spending BTC requires a smartphone or laptop that can connect to the Internet. Although a good percentage of the population today has gadgets and other digital devices, relating to the Internet is one of the challenges many faces.
Not all places have a fast, stable and reliable Internet connection. Some developing countries are dealing with the high cost and instability of Internet connection. This limited connection to the web may be an obstacle to the mass adoption of bitcoin.
4. Bitcoin Awareness
For bitcoin to reach all parts of the world, people must be familiar with the currency and how it works. One way to achieve this is through cryptocurrency education that can be shared through social media. Communities can increase bitcoin adoption and awareness through word of mouth or social media platforms.
Today, bitcoin still has its limitations, but as we gradually transition to a digital world, there could be a chance that cryptocurrencies will finally be considered one of the new reasonable means of finance. Although there are still regulations and technical challenges for bitcoin, its adoption rate is increasing.
There may still be setbacks and challenges for bitcoin to become widely adopted. However, once the world explores and experiences its remarkable uses, there is no doubt that this leading digital asset will be known and used for revolutionary functions in finance and other industries.
