The world of cryptocurrencies is wide and vast, revealing a glimpse of what future markets are going to be like. It’s really an exciting prospect, but I think we’re a long way off from seeing it become a reality. It’s hard to predict if, when, or how new technology will hit a mainstream audience.
Remember, people thought Virtual Reality, Flying Cars, Online Slots, and Fusion Reactors were going to be available in every home by 2015, but here I am in 2020, still waiting for my fusion-powered flying car with VR support. All jokes aside, I really don’t think Cryptocurrencies are going to reach a mainstream audience for a long while yet, and it all has to do with “convenience.”
What is Cryptocurrency?
In case you don’t know, Cryptocurrency is a virtual currency that is secured by what’s known as Cryptography, the science of securing digital files. This security prevents people from infinitely duplicating, double-spending, or counterfeiting their Cryptocurrency. The validity of Crypto wallets is maintained by “Blockchains.” Blockchains are lists maintained across multiple computers that keep track of who has how many coins. With each transaction, the computers in the blockchain check each other’s listings to ensure the exchange is valid, and the lists are updated across the board. It’s very clever, actually.
There are a lot of advantages to a completely digital currency that’s maintained like this. Governments can’t play games with it, and the decentralization of the blockchains provides a degree of autonomy, anonymity, and accessibility. Cryptocurrencies are limited in quantity algorithmically, and the currency is highly resistant to inflation.
In theory, you can access and use cryptocurrencies anywhere in the world, without having to convert between legal tender. By its nature, there’s no need to use a bank or credit card company to handle the transaction of your currency, because it’s all digital and secure. Transactions between two parties can be done directly.
Why I don’t Think It’ll Hit the Mainstream… yet
In spite of all those advantages, I still don’t think that Cryptocurrencies will be replacing traditional currency anytime soon. The most significant indicator of whether or not something will reach a broad audience is its ease-of-use. We, humans, are lazy creatures that love the path of least resistance.
Just look at the difference between technology from ten, twenty years ago and now. Phones evolved from brick-sized landlines to slim, pocket-sized smartphones. Video games went from a nerdy niche to something that even politicians do in their spare time. Books became audiobooks. Cars park themselves. Technological advancement is about streamlining the ease of use so that a wider audience can take advantage of it.
For comparison, let me provide another example of a technology that’s still in its infancy and has yet to reach a broader audience: Virtual Reality.
Now, companies like Oculus and the HTC Vive are pretty successful, but they have yet to reach that mainstream audience, even in the gaming world. Did you know that VR helmets have been around since the nineties? Despite that, VR helmets have only started gaining traction in the past five or so years. They require a lot of room, the helmets themselves are bulky, the games available are limited, and the price point just isn’t low enough for the average consumer to invest in quite yet.
I see cryptocurrencies in a similar way. The ease-of-use just isn’t there yet for Joe Shmoe off the street to be interested. Paypal accomplishes a lot of the same benefits without being tied to a volatile currency. Bitcoin, the most well-known Cryptocurrency, goes for over nine-thousand dollars per coin. At the moment. That’s not exactly pocket change for Joe Shmoe. And if the price-per-coin suddenly drops, as cryptocurrencies at the moment are volatile enough to do, Joe Shmoe could end up losing thousands of dollars by doing absolutely nothing.
It all ties back to ease of use. You can’t go to the grocery store and buy some cabbages with Bitcoin. Until it becomes more convenient to use, and when it becomes safe enough for Joe Shmoe to stash his money away in an account as a cryptocurrency, maybe then it’ll become more widely accepted.
Until then, I think the average guy on the street will just see it as another intangible thing that investors and brokers magically make money off of—professional, high-brow gambling.
But who knows. Maybe I’ll be surprised when, five years from now, the Grand Mighty Mystic Poobah of Earth instates Dogecoin as Earth’s Legal Tender. You never know.