The transition to cryptocurrency is happening right now, albeit at a slow pace. In recent years, both blockchain technology and crypto have been making headlines across various media outlets. While these digital currencies are becoming ever more popular, many people are yet to adopt them. So far, bitcoin (BTC) remains the most widely known cryptocurrency; yet many investors simply do not want to take a chance on this new technology because they are still trying to wrap their heads around what blockchain is and its future in the financial industry.
The question of what forms the main reason for the slow adoption of cryptocurrency remains a highly debatable topic. Some people argue that the technology is too new to be adopted, but it will surely break boundaries moving forward. The fact is that new innovations usually take some time to win the trust of society. The same thing could be happening to cryptocurrencies. Despite the resistance faced by the crypto industry, some companies are working around the clock to speed up the adoption of decentralized digital currencies.
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Here are some challenges that hinder the fast adoption of crypto.
Crypto is Complex and Unstable
One characteristic feature of cryptocurrencies is that they are highly volatile and complex. For example, bitcoin is notorious for being very unstable in value. It can both spike and fall rapidly in value within just a day. This high level of volatility doesn’t make crypto suitable for the payment of goods and services. While those fluctuations may be beneficial to investors, its everyday usability just isn’t as convenient as fiat options.
Until cryptocurrencies are adopted for the payment of goods and services, they may not attract serious attention from investors.
Cryptocurrencies are intangible assets because they can’t be seen or touched. As a result, they don’t have a tangible value. The world is yet to witness the introduction of a paper or coin format of a digital cryptocurrency. Because investors cannot see cryptocurrencies with their naked eyes, some assume that they simply don’t exist in reality. If platforms can come out with specific uses for cryptocurrencies, perhaps they can fast-track the adoption of cryptocurrencies since investors will be more easily convinced about their effectiveness.
Cryptocurrency transactions can be time-consuming. They don’t happen at once. With so many cryptocurrency exchanges involved in the processing of transactions, using crypto creates a lot of inconveniences. For example, it’s impossible to deposit cryptocurrency straight into your bank account without passing through a chain of exchanges.
On the other hand, fiat currencies are very convenient for speed transactions. You can deposit, withdraw, and transfer money to other people’s bank accounts.
Investors don’t fully trust cryptocurrencies because of security reasons. Many scandals have rocked the cryptocurrency industry, leading investors to lose their crypto assets to hackers. These attacks on cryptocurrency exchanges have put fear into investors because they don’t want to fall victim to fraudulent investment schemes.
Cryptocurrency may have a future in the financial landscape. However, that cannot happen overnight because investors are very careful about any adoption of crypto. Entrepreneurs are accelerating cryptocurrency adoption, one solution at a time