Blockchain is seemingly everywhere, with good reason. Organisations and innovation-driven start-ups alike are using the capabilities of blockchain to build new and better solutions to a variety of business and consumer applications. However, blockchain alone is not a silver bullet that can solve all technology problems. In fact, the technology itself needs to overcome its own usability obstacle.
Academics have cited that a general lack of usability risks holding back mainstream adoption of blockchain-based technologies. They argue that where blockchain is being used to build a better solution to an existing function, it needs to be implemented in such a way that is just as easy to use, if not easier, than the incumbent process or technology. Too drastic a change, too extensive the education need, and it will simply fail.
“Easy” is not the first word that comes to mind when considering the current digital landscape, especially where currencies are involved. While there are many potential applications for blockchain beyond finance and cryptocurrencies, it remains the space that has been driving this tech since the beginning.
More often than not, a person must use one service to exchange fiat currency for Bitcoin, go to another web site to exchange Bitcoin for other cryptocurrencies, and then transfer those currencies back into Bitcoin in order to transfer them out of the exchange and back to a fiat gateway in order to, finally, exchange them back into hard fiat currency. Compare that process with the one to change Sterling into Euros, or Dollars into Yen, and its quickly apparent that the digital currency landscape is not only far more bureaucratic and cumbersome to navigate than the established fiat currency environment, its infinitely harder to access at all.
Keeping track of five, 10 or even 50 different master seed phrases for different digital currency wallets, managing a trove of air-gapped devices, and running command line clients on their favourite Linux distro is, at best, an unattractive solution that will understandably put people off the cryptocurrency market.
The potential for blockchain to radically transform the foundational infrastructure of almost every transactional or databased application is substantial. In the currency and foreign exchange (forex) space, it has perhaps the biggest opportunity to effect both bureaucratic improvement as well as deliver ease of access to the user. All at a time when awareness and interest is growing exponentially.
Public awareness concerning Bitcoin, at least, has skyrocketed during 2017. The launch of Bitcoin futures has only added to this interest, with one exchange signing up in excess of 100,000 new users in just one day. Institutional interest is also spiking. Jamie Dimon, CEO of JP Morgan, once called Bitcoin “stupid” to much fanfare. Today, JP Morgan is both actively developing it’s own blockchain tech and, now, expressing interest in Bitcoin futures.
As more possibilities for blockchain emerge, the role of cryptocurrency has evolved from the model of being exclusively a digital peer-to-peer currency into a diverse digital asset economy with many applications. While there is huge potential for a new class of tokenized assets and new frameworks for exchange, this space is still struggling with accessibility.
For any cryptocurrency to be useful, it cannot exist in a vacuum. The same applies to a fiat currency. Both require interfaces and bridges to the broader economy. Fiat currencies have them, whereas they are a work-in-progress for the crypto world.
We see an urgent need for one platform, like CoinMetro, that could perform all the functions that currently requires a user to rely on several different, sometimes complex, applications. We envision a platform where a new trader could buy their first Bitcoin, work with a professional trader, diversify their portfolio in a few clicks, and easily move between fiat currency and digital assets all in one place. Keeping such a platform user-friendly, while at the same time offering an advanced trading interface for professional traders, is essential to success.
One of the biggest issues facing the cryptocurrency and blockchain space today is how this new economy works with the traditional economy, particularly in terms of regulation and integration with existing financial institutions. We’ve seen this firsthand, given out background in the traditional forex industry with FXPIG. It is a sector that has learned to adapt to a changing regulatory environment, and to be proactive in terms of working with regulators rather than fighting them at every turn.
It is why any unified fiat/crypto trading platform needs to embrace regulation, securing licensing in crypto-friendly regions, as well as in jurisdictions where crypto will likely be umbrellaed in the near future. Doing this will allow any such platform to function like any established forex service, easing access to the user by delivering an experience as effective as the fiat forex platforms.
Investing in digital assets needs to be an easy process. By creating a highly accessible user-interface with direct integration into both traditional banking and multiple blockchain platforms, unified currency exchanges offer a framework for mainstream adoption.
An all-in-one platform committed to simplifying the digital asset economy and creating opportunities for users at every level of experience is more important than ever if the current interest in cryptocurrencies is to become mainstream, stable and investible for the long term.
By Kevin Murcko, CEO of FXPIG and CoinMetro