5 Obstacles Stopping Mainstream Acceptance of Cryptocurrency Over 2000 companies can't be wrong, right?.......right?

Cryptocurrency is everywhere these days, and it’s hard to tell if that’s a good or bad thing. There are over 2300 cryptocurrency coins and tokens currently known by CoinMarketCap, as of September 2, 2019. By comparison, there are 180 fiat currencies recognized by the United Nations.

It may look impressive in a purely numbers-driven market, but the reality is there are only few dozen decent crypto and blockchain projects on the market. And this fractured market is creating its own problems for itself.

I’ve researched over 200 of the top cryptocurrency and blockchain projects over the past few years. It felt like joining Scientology, which has all the same general steps to enlightenment as any other religion but requires you learn Klingon before understanding what the hell they’re even talking about. As the joke goes only blockchains from a specific region in France are called blockchain; otherwise it’s just a sparkling distributed database.

Don’t get me wrong – there’s some impressive tech, the projects are all ambitious, and the industry is actually growing. But it’s all happening a lot different than anyone imagined. Bitcoin truly did open the floodgates and create a massive change in the world. But those who earned fortunes from digital currency are still struggling to find relevancy.

IBM Quantum Computer

For example, I went to CES hoping for a decent show of crypto and blockchain projects. Instead, I found mostly vanity parties from the crypto community, with Brock Pierce at Mike Tyson’s mansion being the major draw. I ended up the only legitimate crypto journalist on the show floor, while the Crypto Briefing idiots were off in San Francisco holding a separate event from the rest of the entire world. They didn’t just blow off tech – they blew off Silicon Valley, Hollywood, D.C., and international leaders from around the globe. CES is a major event, and crypto failed.

But lack of professionalism and bad decision-making aren’t the only things slowing this industry down. Nobody seems to understand what they’re talking about in crypto, and the general public simply doesn’t care. Here are five reasons why.

1. Everything Is Bitcoin

CES Bitcoin

To listen to the crypto industry tell it, every day is filled with massive improvements to the vital industry projects. But nobody outside crypto really cares when Binance or Huobi adds derivatives trading and the BSV token to its platform, much less that they have a Binance (BNB) a Huobi Token (HT). All anyone in the general public ultimately cares about is how to easily exchange Bitcoin and fiat currencies or spend Bitcoin like cash.

Projects like Decentraland (MANA), Basic Attention Token (BAT) and its Brave Browser, or VeChain Thor (VET) may sound great in theory, but this industry is quickly learning how hard it really is to introduce these blockchain-based products into the marketplace. And it’s not being made any easier anytime soon. I was paid for two years to track it all, and even I can’t (nor do I particularly care to try).

Bitcoin alone has a dozen forks, so now you not only need to know what bitcoin is, but also a fork and which particular fork is the right one, as they continue hurling insults at each other on Twitter over philosophical differences nobody cares about. It’s enough to give anyone a headache, even those whom actually care.

Business owners are starting to integrate BTC ATMs in their stores, the currency is accepted pretty decently online. Surveys over the past few years show anywhere from 60 to 80 percent of Americans have heard of Bitcoin, while only 5-11 percent actually hold any.  Of those, I know nobody in my daily life who does anything with it except hodl as a social experiment.

No matter what you think from the trenches of blockchain and crypto, the general public, even highly intelligent engineers, are completely uninterested.  And what little knowledge people have of Bitcoin typically involves two constants: it’s full of crime and the price changes too fast.

Check out more pictures from CES 2019.

2. Volatile Pricing

beyond-bitcoin

Financial regulations are in place for about 100 reasons that became hilariously obvious as cryptocurrency grew. It’s naive to think the banks or politicians are uniquely corrupt and can be easily replaced by the inexperienced. Our relatively tame and somewhat regulated financial system has now been flooded with scores of tokens, and it wasn’t long before people figured out how to manipulate the price.

Tether (USDT) was allegedly used to manipulate the price of bitcoin when it reached record highs at the end of 2017. After a long bear run in 2018 in which the price of the crypto market retracted, by April 2019, the price was skyrocketing back up, once again using USDT to fake fiat money going in. These massive price changes one year to the next from $100 to $20,000 to $4,000 to $10,000 shows an artificially inflated and unregulated market.

We have models for this. There are examples of unregulated markets throughout history. There’s a reason financial markets are regulated. We don’t just let anybody list their stock on the New York Stock Exchange (nor does any other country). Lack of cryptocurrency regulation is causing market manipulation and volatile price swings while all the crypto-rich companies keep creating more organizations and holding corporations and advanced tools.

Cryptocurrencies will always be used to prop up the price of bitcoin, and the environment isn’t made any easier by the sheer value of lost BTC in the world. Wired estimated it between 2.78 and 3.79 million bitcoins lost in 2018, and that was before QuadrigaCX CEO Gerald Cotten died in 2019 with the only password for $190 million worth of BTC).

3. Unscrupulous Opportunists

78-million-bitcoin-theft-confirmed-1021x576

Cryptocurrency has a massive PR emergency fire that’s been raging across the globe for the vast majority of its decade-long life. BTC is associated with crime in every way, and that’s because hackers are stealing it, governments are stealing it, and the one business that always accepts bitcoins is crime.

Take ransomware, for instance, which cybersecurity companies like Symantic and MalwareBytes report is increasing exponentially year-over-year. We saw a nearly 200 percent increase in 2019 alone, expected to cost around $11.5 billion globally this year. Much of those payments are being made in crypto, and automated trading bots then launder the money through popular privacy coins and OTC exchanges to successfully get away with a crime they were already going to commit.

And this isn’t unique to your traditional ideas of crime. Much of the criminal behavior is a last-ditch effort to survive.

Everybody is using cryptocurrency as a way to fund failing businesses, and a recent incident involving a Keralite businessman being tortured and killed over missing bitcoin highlights another dark side to the industry. People are flooding social media, YouTube, and everywhere in between with either “the next Bitcoin” or “blockchain” or whatever. Even if you understand cryptocurrency, you’re basically just investing in a company, which you always could have done in the form of stocks, bonds, penny stocks, and other investment vehicles.

Crypto and blockchain didn’t do anything new – it simply digitized pre-existing concepts to essentially open-source what used to be proprietary financial industry knowledge. It’s one of the downsides of the Internet (though I personally find it to be an upside) – once the information is out there, it’s out there. And now some entrepreneurs are building great businesses while others are scamming people for $220,000 on Twitter.

Scams are popping up left and right in crypto, and if you’re lucky enough to avoid them, your exchange or wallet could go down or worse. And if there’s one thing both Donald Trump’s White House and the United Nation agree on, it’s that crypto needs to be in their crosshairs.

4. Industry Infighting

Craig Wright Versus

If you care about cryptocurrency, you may already be aware that people like Craig Wright, Roger Ver, and Vitalik Buterin have different opinions on economic philosophy. Its become a reality show of an industry in which people are rallying around virtual currencies with even more fervor than we do our actual nationalities, races, political affiliations, religious beliefs, etc.

People are really passionate about cryptocurrency, and that’s fine. But all these conflicts make it impossible for any casual user to care. Nobody cares what a bunch of nerds think about it all. We just want the value. Steve Jobs was more than just a turtleneck. He had a vision and created value. That, along with supply and demand, should be driving crypto.

But it’s not – what’s driving crypto is a lot of trolling, peacocking, and artificial manipulation. Nobody’s arguing that virtual currencies have value. But that it has value and the value you’re adding to/with it are different things. The crypto industry is just a younger, unregulated banking and tech industry. Hell, most of them are pre-existing companies just issuing their own Itchy and Scratchy Dollars.

And there’s no better proof of the illusion of crypto than in the sheer volume of projects still around.

5. Lack of Mergers and Acquisitions

Facebook Libra

As much as the cryptocurrency industry hates to admit it, Libra is a very important coin. It’s proof of what’s actually happening. See, Facebook didn’t simply acquire a crypto, which it has the money to do. Neither did Amazon, Google, or any of the major companies that would normally have been in the position to do so.

Instead, Facebook called the blockchain industry’s bluff and created its own cryptocurrency. And love or hate Facebook, this tech juggernaut is bigger than (name your favorite website). Yet still nobody uses Messenger to send payments. Statista reports 79 percent of people aren’t using this feature.

In fact, mobile payments are still the least-often used form of payment, despite every major retailer and restaurant now accepting mobile payments. People simply don’t like using mobile wallets, and that’s a big part of what cryptocurrency is. I have wallets for Coinbase (the exchange and the wallet), Binance, Coinomi, Trust, Ledger, Trezor, and so many more, it’s ridiculous. Nobody needs that many apps on their phone.

Projects like Pundi X are branding generic smartphones as a vanity project for press coverage when they should be focusing on something productive. Everyone’s raining tokens on people, but most blockchain projects are complete ghost towns. Most crypto trading is automated bots. None of this is real, and that’s what Facebook is doing.

If it works, Amazon, Google, Apple, and everyone else will follow suit. And then your Disney Dollars will be worth as much as Bison Dollars.

Conclusion

Cryptocurrency and blockchain has a lot of potential, but it’s also a massive bubble that its acolytes don’t want anyone to ever wake up to. Once again, greed and marketing have everyone trying to save their own asses in an artificial economy. This is the reason there’s fake news in the world.

But that doesn’t mean everything cryptocurrency nor blockchain is bad. Many of these projects are working with regulators. Coinbase is even a part of Facebook’s Libra project, alongside PayPal, Visa, and others. It’s a strong sign that we’re all going to be working together. Just because Coinbase is going to survive doesn’t mean every single other project will.

When I’m 80, there will probably be 2000 Bitcoin forks alone, and everybody will be issuing our own currencies. We’ll use it for reputation, tokenized transactions, and to pass assets down through the generations. We’re living at the brink of a new world that was absolutely changed by Bitcoin. There’s no denying it, and it was a drastic change. Now we need to figure out what’s next, because the population doesn’t care about how much money you made trading imaginary coins.

Versability

Dr. Brian Penny is a former Business Analyst and Operations Manager at Bank of America turned whistleblower, troll, and freelance writer. You can find his work in Cracked, High Times, HuffPost, Lifewire, Forbes, Fast Company, and dozens of other places, although much of it is no longer under his name. Dr. Penny loves annoying fake media.

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