I’m very positive about the future of cryptocurrency and blockchain technology and the good that it can bring to this world. But it’s not gonna be a straight line to mass-adoption. It’ll take a while for the good in people to cut through greed, inequality and evil powers.
I’ve written in the past about how software and technology can have very harmful impact on things. While being optimistic about something, it’s also important to be realistic. And right now, in the cryptocurrency space, many people don’t seem to see the many bumps that lay ahead of us. Here I’m going to cover just a few of them, that comes to mind.
Considering that Bitcoin came to life in 2008-2009, one can argue that the adoption of the concept and the technology has been slow, in relative terms. I believe that was partly due to the reputation Bitcoin earned by facilitating pseudo-anonymous payments on dark marketplaces and adult entertainment sites. This has been the case with pretty every new technology, including the telephone, cinema, VCR, Internet, virtual reality etc. The adult entertainment and blockchain company called Spankchain, clearly points this out on their blog.
While, in theory, parties in these industries could use increased security and fewer middle-men to exploit one-another, what’s happening, in practice, is that even more money and activity is flowing into these markets. It’s human nature or something, and as with most human things, probably not a good idea. But these things are inevitable with any new technology, as mentioned earlier.
It’s often written about in media, that blockchains and cryptocurrencies will bank the unbanked and a be wealth equaliser. Even the World Economic Forum is writing about it. And while there are good merits to these ideas, it’s going to take a long while until we get there. Maybe as long as 10-15 years.
Right now, wealth is quickly consolidating to early adopters, developers, and Wall Street. It’s not unlikely that this recent 50-60% price dip, was due to large institutional investors intentionally shorting the market with their deep pockets. It’s a rogue and unregulated field, so why wouldn’t they use this to their advantage? Lots of new and unexperienced crypto-traders panic sold and lost a lot of money to Wall Street in the end. Cryptocurrencies are currently consolidating wealth, not distributing it.
Governments and regulation
There’s no doubt that cryptocurrencies and blockchain technology can bring an enormous amount of positive change to national governments. But then there’s also governments like Venezuela, that will create cryptocurrencies with very questionable motives. And isn’t it quite likely that North Korea is using a big Bitcoin stash to bypass international sanctions? These kinds of stories will continue to emerge for quite some time, until governments truly understand the technology, and know how to best regulate it (and where it’s impossible to regulate it).
One thing that is certain — it’s gonna be a bumpy ride ahead. And it will get worse, before it gets better.