Hindrances Restricting the Mass Adoption of Cryptocurrencies

  • January 6, 2021
  • Jennifer Moore
Hindrances Restricting the Mass Adoption of Cryptocurrencies

The release of the Bitcoin whitepaper was decades ago. When it comes to market capitalization for crypto, the amount is over 200 billion dollars. However, the success rate of cryptocurrencies in going mainstream has not seen an uphill curve. The adoption of crypto over the years has been increasing and the quick price hike in 2013 and 2017 encouraged mass adoption and helped raise awareness. Read on to find more. 

Performance of Bitcoin in Comparison to Other Cryptocurrencies

When it comes to the performance of Bitcoin in comparison with other cryptocurrencies, Bitcoin has progressed far better than additional cryptocurrencies. With tech giants accepting Bitcoin payments, the original goal of cryptocurrency has been realized through Bitcoin with numerous use cases throughout the world. However, as far as the original goal of cryptocurrency is concerned, it has not been uncovered yet, and it’s high time cryptocurrency is required to overcome the major roadblocks. 

As per reports, 2021 could be a tipping point for cryptocurrencies. With more than 2000 cryptocurrencies within the market, all the utility coins claim to be better than one another and resolve challenging issues in various industries. However, when it comes to mass adoption, digital currencies are yet to gain the same due to numerous reasons. Let us check out the points below to understand better. 

Also Read: Top 10 Cryptocurrency and Blockchain-Friendly Countries in the World

Why is the Mass Adoption Cryptocurrencies Lagging Behind? 

When it comes to the mass adoption of cryptocurrencies, there are various stages yet to happen. Among them, awareness, institutional adoption, regulatory and political acceptance are of utmost importance. For being an easy and seamless experience for institutions and users, here are a few points to help understand the roadblocks in the crypto journey. 

Cryptocurrency is On-Ramps

Cryptocurrency is on the ramp and this is the biggest point of friction in the Crypto industry. Shifting from Fiat currency to cryptocurrency needs communication with a regulated and centralized entity and moving through KYC and AML. Sometimes, it can also lead to a massive drop off. 

When it comes to crypto prohibition policies, they are not necessarily inspired by the effort to prevent consumers from misinformed credit card debt or investment decisions. When it comes to cryptocurrencies, banks have remained defensive because they happen to be attempting to build a moat encompassing themselves, by not banking Crypto. It is one of the reasons why it is challenging for amateur innovators to bridge Crypto and Fiat currencies and find reliable custody partners. 

Regulatory Processes

China banned initial coin offerings in 2017, thereby leading to our Crypto trading ban on foreign exchanges. Some countries have been hostile and restricted like China, thereby lagging behind when it comes to mass adoption. In this case, the Chinese regulators have taken necessary measures to determine the utilization of cryptocurrency in the nation because they were ready to launch their own cryptocurrency. 

On the other hand, other countries have remained friendly but they do not know where to start. When it comes to Western countries, they have been somewhat reluctant when it comes to the regulation of digital currencies. Some regulators also do not understand the technology enough to put suitable regulatory laws in place, thereby leading to a hindrance in the mass adoption of cryptocurrencies. 

Also Read: Blockchain 2020: The Year in a Review

Lack of Education

The lack of education is one of the reasons causing hindrance in the mass adoption of cryptocurrencies. Maximum people do not understand how cryptos work and cannot differentiate between cryptocurrency and blockchain. Cryptocurrency’s learning curve happens to be particularly steep. On the other hand, blockchain appears like abstract ideation that happens to be approximately impossible to understand. 

The fear of not understanding cryptocurrencies and blockchain clearly happens to be a massive detergent. That too for most people looking forward to getting into the field of blockchain and cryptocurrency. Education happens to be an important layer that needs to be addressed to achieve greater mass adoption. 

Final Verdict

Before directly jumping into the mass adoption of cryptocurrency, there are two things that require happening. We need to build better experiences so that less technical people can utilize cryptocurrencies. The process of utilizing them should be like using phones, driving cars, charging credit cards. That is without necessarily knowing how they work. Apart from that governments need to create a suitable environment for cryptocurrencies and blockchain technology. 

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