In a recent panel discussion on Bloomberg Opinion, one of the topics of discussion was about cryptocurrencies being used by 2 billion individuals who did not have bank accounts but had access to mobile phones. The debate was on whether it was practical for them to use cryptocurrencies as they do not necessitate the opening of a bank account.
Tyler Cowen, an American economist and an economics professor at George Mason University, was one of the panelists. He opined that the major problem with cryptocurrencies today was that they were competing against various innovators in the payment space.
To strengthen his point, he said that institutional investors did not necessarily have to adopt cryptocurrencies and that they could adopt cheaper ways of making transactions or handle assets. Tyler added:
“Whether Bitcoin and cryptocurrency can outcompete that, well… Bitcoin is a highly flexible system, in some ways, until you have a fork, I suppose I would bet on the payments companies.”
Elaine Ou, Blockchain Engineer at Global Financial Access in San Francisco, spoke about how cryptocurrencies could move from a stage of evasion to mass adoption. She stated that the early adopters of cryptocurrency were generally using it to evade certain regulations.
Bitcoin, according to her, had started becoming famous during the time of the Silk Road, which is a marketplace to buy drugs among various other goods and services.
She further added that Bitcoin’s early adopters were those individuals who did not have another option and this was because the centralized system was very efficient. Elaine commented:
“So only if you’re forced to use a decentralized system, you’re going to do that because it’s really inefficient in the present day scenario.”
Elaine also spoke about how cryptocurrencies could become appealing to those who earlier wanted to evade it. She further stated that cryptocurrencies had to get to the point where it was as easy to use as the existing payment systems. Elaine added:
“I mean that’s a big ask because right now, if you really want to be your own Bitcoin bank, you need to, you know, download the software sync the blockchain. It’s really quite difficult, so Bitcoin needs to get to the point towards where it’s as easy as installing an app.”
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