The world of cryptocurrency is on the constant expansion with new blockchain protocols and cryptocurrency mushrooming every day, each one of them is coming up with promises to offer unique experiences. There are more than 2,000 existing cryptocurrencies and each of these competing currencies is striving to gain a big chunk of the user traﬃc. This competitive spirit is good but unfortunately, the whole cryptocurrency world has not yet presented itself in one binding form for mass adoption. Bitcoin has a long way to go if it wants to escape the niche adoption among tech geeks and libertarians and be a more global artifact.
To scale up bitcoin use and make it suitable for mass adoption, the following things should be considered.
1. Customer protection through the involvement of intermediaries
The general public notion about bitcoin is a bit hostile. Most people see it to be too technical. Some regard it as a money laundering scheme. There are also those who adopt it with great suspicion as they are familiar that the whole process to buy bitcoin often involves placing a great deal of trust to the selling merchant. Only a few buyers and sellers hire escrow agents to mediate the business, which then again raises the expense and complicates the whole process.
User’s digital assets are stored in a digital wallet with a security key. However, in the absence of a reputable custodian, these security keys are susceptible to unauthorized access. Involvement of reputable and trustworthy intermediaries such as Paxful would be a definite help to raise security and reliability of cryptocurrency tradings. The possibility of keeping your bitcoin wallet safe, easy management of the user private keys and reliable monetary transactions are some of the well-known merits of bitcoin and other cryptocurrencies, which are on the hold and they need to spread around to aspiring public thereby improving Bitcoin’s image.
2. Regulatory provision
Cryptocurrency trading is liberal in the sense that it contains both legitimate and fraudulent offerings to all prospective users. Since bitcoin is still in its early adoption days, there are a ridiculous number of schemes and scams posing as honest, seemingly practical, legit transactions. Enforcing sets of regulation to uniformize any and all the transaction(s) is very much needed in order to check these scams. These regulations could be some sort of legal document that merchant(s) and buyer(s) sign. The document could also contain a mutual agreement or provision for repercussions on failure to perform. These customary practices could also set up an exchange rate and enable buyer-seller to interact vis-a-vis. Easier said than done, regulatory customs are two-edged swords as one way it would add up legality and transparency to the transaction while in another way, it would unintentionally expose the privacy of the business. As a result, regulatory provision could scare bitcoin traders and merchants away.
3. Address to the issues of volatility
The volatility of ﬁat currencies is as old as the currencies itself. Bitcoin also suffers the same fate as the volatility of bitcoin obstructs the ﬂuidity of the transaction. Today you might have to pay $1,500 for a bitcoin but tomorrow you might have to pay $1,700. The price is always changing and there’s nothing we can do about it. Volatility impacts both the sellers and buyers equally as under uncertainty. Sellers would likely jack up the price in order to compensate for additional risks while at the same time, the buyer would likely be struggling to choose between buying and waiting. Should bitcoin be legitimized and be treated as an equal peer to the ﬁat currencies, the volatility could be addressed appreciably. By the rule of economics, volatility will gradually decrease with the increase of adopters hence the increase in market cap. Legitimacy certainly looks like a far cry now given the occasional chaotic nature of price fluctuations.
Many pump-and-dump schemes work to artificially increase the value of a currency by buying in bulk and then sell when the supply is low. This causes massive fluctuations in prices and places cryptocurrencies as unstable commodities in the eyes of the public. Some sort of regulation has to be introduced to stop these Ponzi schemes so the public can differentiate fraudulent schemes from more legitimate ones.
4. Speedy and energy eﬃcient operability
Bitcoin must be able to process as many as 7,000 transactions per second just to compete with the traditional payment system. So far, it has fallen behind to around seven to ten transactions per second. Additionally, it must be equipped with the ability to record the transaction history correctly in an easily accessible database.
Monetary transaction through Bitcoin often generates large collections of traﬃc in the site, which must be handled very neatly. There are new emerging cryptocurrency trading platforms which process transactions reliably, neatly, and cheaply. In order to mine these cryptocurrencies, you’ll need some equipment. These pieces of equipment have deceptive looks of old computer sets and are operated with electricity. They must process fast and must work in an eﬃcient manner to be effective. However, if such mining equipment consumes more electric power than necessary, mining cryptos becomes tedious ﬁnancially and input-wise. Governments could track down on such heavy electricity drawing places. Make sure that you take this into account, especially if you live in a place where crypto mining is deemed illegal.
So developers must set up the as per the statutory binding regulation. Search for a new frontier market where the cost of electricity is cheap could be a to initiate crypto mining. The recent developments regarding proof of stake over proof of work and using solar energy to mine have been encouraging but they should be more reliable and widely accepted.