Story attributed to George Hartley, CEO/Co-founder at Sendy Network.
The Trust Irony
Heralded as the harbinger of a revolution in the way the world transacts value, the cryptocurrency jet has not quite taken off yet. The system, which was supposed to distribute trust such that there is no longer a need for a ‘trusted’ third party to validate transactions, has developed some trust problems of their own.
A good majority of the world would likely struggle to even explain what a cryptocurrency is or how it works, let alone choose to use it over fiat money via established banks. Beyond that, regulation around the entire space lacks clarity (although promising progress has been made of late), which tends to deter both active use and capital injection. Bank deposits are, to a certain extent, protected against theft or loss. Legal recourse for such events relating to cryptocurrency are almost unheard of since access rights are only conferred to users themselves.
The inherent price volatility of cryptocurrencies prevents them from becoming a viable medium of exchange for goods or services. They cannot benefit from monetary policy that nation-states can implement for their respective fiat currencies and are susceptible to violent price swings in either direction. Coupled with speculators and market punters looking to turn quick profits, volatility does not seem to be an issue that can be easily tackled.
What User Experience?
Adopting cryptocurrency, however, is no simple affair. Between setting up a wallet, private keys and public keys, the user experience is in dire need of some serious improvement. This is before we even go into gas price, gas limits and the host of confusing terms that come along with it.
Even for the initiated, just logging in to their personal wallets and sending funds to their friends seem to be a perilous task. At each step of the way, one might be second-guessing if a hacker had somehow gained access to their desktop, or if they had entered their private keys into a fraudulent site. The entire process can even be stressful.
How then, can we empower more inclusion in the benefits of a decentralised world?
Perhaps the most obvious answer would be to focus on helping develop an understanding of the technology and building knowledge around it so that perceptions of the space are not clouded by misconceptions and hype surrounding ICOs or the value of bitcoin. A fundamental understanding of how cryptocurrency wallets work will go a long way in helping users be more careful with their private keys. After all, the spirit of the technology is inclusion – and everyone involved should have a vested interest in educating the public.
The key to adoption for the above technologies (besides their function as medium of communication) is usability. We view the internet through browsers, navigate mobile phone interfaces that are increasingly intuitive to use – the user experience is almost seamless. Much less can be said about the current state of affairs for majority of digital currency applications. Adoption for digital currencies is imminent, but a user-friendly interface that can help new users along the journey is still very much a necessity for inclusion.
While there are significant hurdles to cross before we can contemplate mass market adoption of digital currencies, these challenges are far from insurmountable. In the infrastructure layer, there are scalability issues which affect transaction throughput. What is encouraging is that numerous blockchains are focusing considerable effort into implementing scalable solutions, but these take time to ensure little to no compromise in security.
On the regulatory front, tax concerns and even ICOs and secondary market trading of digital currencies are still proving to be challenging to regulate. However, the framework for regulation is slowly but surely taking shape with clampdowns on scams and errant operators ramping up. New systems do not emerge overnight – they undergo a process of adoption that takes time. Much like how the concept of ‘money’ has changed over time (barter to cash, cash to credit/debit cards, contactless payments), digital currency is the next step in advancing the way the world perceives value.