Vitalik Buterin, a powerhouse in crypto, the mastermind behind the Ethereum network, effectively denounced those obsessed with the price of crypto and its possibility for breeding derivative financial instruments, tweeting recently “I think there’s too much emphasis on BTC/ETH/whatever ETFs, and not enough emphasis on making it easier for people to buy $5 to $100 in cryptocurrency via cards at corner stores. The former is better for pumping price, but the latter is much better for actual adoption.”
But this too misses the point.
Crypto provides no value to the average Westerner. Making crypto more accessible is not enough.
There’s no reason for the average Westerner – my aunt and uncle for example – to care, because crypto brings no additional functionality to their lives. They ask me about it practically every time we talk. When they ask me what to do with it, despite my five years of involvement in the industry, I have no answer.
All crypto, Bitcoin included, is a speculative play at this stage. Like any early-stage technology, we have yet to figure out many uses in which Bitcoin beats the legacy competition in functionality.
As an example, for payments, credit cards are better than crypto. So is PayPal. Cash is better too, if only for the network effects, but in reality for far more. That’s why more people use those methods for payments than Bitcoin.
Cheering on or otherwise attempting to rush the price movements of Bitcoin is futile. Praying for its movements is futile. Pitching its potential with slick marketing is more than futile, such marketing is in fact most likely counterproductive as it will leave early adopters disillusioned.
A curse of Bitcoin is that it is a currency and it is unable to be far removed in people’s minds from its very volatile price. Of course, the beauty of Bitcoin as well is that it is a currency. Through it and similar technologies, we will come to know the folly of applying natural monopoly theory to currency.
In disabusing ourselves of such thought, we will come to know the vast potential to humanity that awaits us by subjecting the currencies to an unregulated marketplace where no government enforced monopoly prevails. Much like the commercially successful iPhone came approximately 23 years after the end of a government enforced monopoly in telephony in the US, we have no idea what may come 23 years after an end in the government enforced
monopoly in currency in the United States.
Like telecom, like railroads, like motorized carriages, like the internet – Bitcoin will become adopted when it has a level of functionality so obvious that by word of mouth people know its value in their lives so profusely that it would be foolish for them to do anything but to start using the technology.
That moment has yet to arrive.
It will require simple ideas made better, it will require time, reputation, and funds ventured, likely many failed businesses, and probably only a few long term successful businesses for us to get to that point. Eventually, some mastermind will figure out a way to commercialize an idea that no one has successfully commercialized.
The time for that work is now. Opportunity is ripe for the picking. The immature cryptospace awaits the person who can make crypto not just utilized as a speculative play but as a technology far more valuable than the alternatives that preceded it.
Groundwork has been laid, mostly by people who history will forget. The Horatio Allens, William Norrises, and Stephen Balzers of crypto have done their work. These are likely unheard of names by the readers of these pages. Similarly, the early crypto founders that history will forget will give way to the next cohort – The Pullman of Bitcoin, the Westinghouse of crypto, the Ford of digital assets, the Gates, the Jobs – the innovators that made the technology usable and accessible and desirable.
Those few who succeed in the next stage will become Bitcoin billionaires and be immortalized as the fathers of an industry. It won’t matter who came before, at least not in the history books. The few of us who know the early innovators in crypto will have some fun trivia one day because we will know the names of the people that did things that the world will eventually consider trivial.
The people who take the next step and make the technology indispensable to the average American will be the ones who become household names, because in a marketplace utility drives adoption of a technology.
The main issue that matters to a consumer is utility -“What’s in it for me?” Only with an undeniably simple and in demand answer to that question will we see adoption. In his brief tweet, Vitalik missed that point. Convenience does not drive adoption, utility drives adoption.
What’s in it for the average Westerner? So far, the answer is nothing. Many in the cryptospace work hard for the answer to that question to change.