Adoption is a frequently used word in the cryptocurrency world, so much so that some don’t even stop to think about the real meaning of the word. In the general sense of the word, adoption is the act of taking something on as your own. This means to use something in a way that we consider adequate. But when someone refers to cryptocurrency adoption, the meaning is linked to the idea of how much a certain cryptocurrency is being used, by whom, and with which objectives.
In this sense, cryptocurrency adoption has come a long way since Bitcoin was created back in 2009. The most known cryptocurrency right now has morphed from being an obscure reference in a cypherpunk mailing list to an asset that is currently traded on hundreds of exchanges at a worldwide level. Just recently, El Salvador adopted Bitcoin as legal tender, making history in the process. However, this is just a single country, and the use of Bitcoin will be optional according to statements from Nayib Bukele, president of El Salvador.
Crypto Adoption Means Problem Solving
However, cryptocurrency is still in its early stages, and some problems are stopping Bitcoin from becoming much more than what it is now. Some come from the nature of cryptocurrencies, others derive from the market that has been created around them.
One of the first problems that cryptocurrencies face is governments. Cryptocurrencies like Bitcoin propose a full system for people to sidestep the already established state backed by hundreds of institutions that control it. Nations won’t concede this without a fight. In fact, day after day more and more countries are establishing laws that restrict the use of cryptocurrencies and control them like current assets and fiat currencies.
Another impediment that cryptocurrencies face in being widely adopted is the inability of some to support money movements in a real-world environment. In the case of Bitcoin, with the current capacities, it would be impossible to manage the economy of the whole world on-chain. Some solutions like the Lightning Network have been proposed, but in general, the implementation of these services is yet another problem.
Last but not least, volatility is still a big problem when using regular cryptocurrencies. Prices can fluctuate heavily in just minutes, and it is not good to use these assets as a medium of exchange or unit of account. However, even with all these problems, cryptocurrencies have advanced so much as an industry, as currencies and assets.
There is real adoption happening now in financial markets and developing countries. According to the 2021 Global Adoption Index, calculated by Chainalysis, a crypto intelligence firm, adoption is happening faster in countries like Vietnam, India, and Pakistan.
This shows that when economies fail and fiat currencies lose their value, people are much more inclined to use cryptocurrencies as an alternative. In this way, as inflation hits more economies, and big fiat currencies like the dollar start falling, cryptocurrencies will be more used at a worldwide level.