Beginning with the inception of Bitcoin, cryptocurrencies have grown to a tremendous size. You name it and likely someone has thought of a way to tokenize that industry. From borderless payments to renting luxury yachts, cryptocurrencies have sprouted to fit many shapes and sizes of businesses. Is it truly for the betterment of the ecosystem? Or is this explosion of tokens hindering mass adoption?
My take is that each coin has a part to play in the overarching theme of decentralization and blockchain technology. Considering that blockchain is barely a decade old, it’s objective of being a staple in the lives of billions is still a far off. However, we have come a really long way since 2008. It takes the guts and gallantry to attempt to revolutionize a 500 year old financial framework, and these cryptocurrency projects sure do exemplify those traits. Take bitcoin for example. If not for Satoshi Nakamoto’s audacity to introduce this decentralized alternative, we would not even have smart contracts or dApps ( which are like the android/apple play store apps in our phones).
So, will cryptocurrencies really benefit society then? Here’s several ways that i believe this can elevate lives.
Ironically, those that can benefit the most from said technology have the lowest access to it. In Venezuela, with inflation hitting mind boggling figures, citizens have turned to the blockchain. Bitcoin is being used more and more and a means of payment and value. Instead of carrying around mountains of cash everywhere, individuals transact with bitcoin through their smartphones. In Kenya, for years, their means of settlement has been through the mobile app and payments service M-pesa, which has its own form of credits. Recently, that standard has since integrated bitcoin and other cryptocurrencies too. This adoption of bitcoin is a primary illustration of the paradigm of decentralization.
A very tangible use case for cryptocurrencies right now is remittance. Blockchain technology is enabling millions of individuals to effectively send money across borders. Companies such as rebit.ph have emerged to solve the expensive transaction costs associated with remittance which often takes a 6–8% haircut (according to worldbank.org). In philippines alone, remittance amounts to 33 billion yearly and cost is eliminated thanks to the blockchain.
Those lucky enough to have stable government and financial infrastructure might see cryptocurrencies as just another fad. In Singapore, with instant payment alternatives like PayNow, bitcoin falls short on the list of priorities. However, blockchain technology is growing at an incredible pace. In my own opinion, we would be seeing blockchain as the imperative data structure of many companies soon. Much like how Linux technology powers every computer device we interact with.
The blockchain has the power to disconnect from traditional financial institutions and gives the individual power to dictate “value”. It also empowers networks to sustain trust through trustless protocols. Mainstream adoption of blockchain technology will be slow but eventual. It is likely to only take a few years for the term “blockchain” to be a household name.