Opinion | Members of the Korean Financial Services Commission: Lack of actual use is the biggest obstacle to the development of cryptocurrencies

A key member of the South Korean Financial Services Commission (FSC) Blockchain Advisory Committee stated that the lack of real-world use cases is the biggest problem preventing the growth of cryptocurrencies, according to Decrypt reported on March 3.

bitcoin-and-other-cryptocurrency-exchanges_800 (Image source: goodfreephotos )

Hong Ki-hoon is a member of the Blockchain Advisory Board of the Korean Financial Services Commission, and he also teaches economics at Hongik University. He said that the main obstacle for the government to regulate the blockchain and cryptocurrency industry in the past two years has been the ambiguity of cryptocurrency assets.

In an interview with local media, Hong Jixun said:

When the user asks' Where can we use this crypto asset? 'They often don't get very clear answers. Some answers describe cryptocurrencies as a security. When users ask 'Why is the price of coins rising?' The answer is because the business behind it is expanding.

He said that this again raised the question of whether crypto assets are a security asset:

Cryptocurrency is a practical asset, but companies eventually describe it as a security. This is the biggest problem facing cryptocurrencies.

Why cryptocurrencies are difficult to adopt

At the beginning of the 21st century, South Korea's most popular social media platform was Cyworld, where tens of millions of people bought the platform's Acorn token to buy songs, items, decorations and emoticons.

Hong Jixun explained that there is no other cryptocurrency asset that can reach the level of use of Acorn, except for cryptocurrencies with large market value such as Bitcoin and Ethereum. He noted that in-game token usage on Twitch, Steam and social media platforms is much higher than most cryptocurrency assets.

Hong Jixun said:

There are still many obstacles to be overcome in order to truly implement blockchain technology in realistic scenarios. New projects fail every time they enter the execution phase. Therefore, at this stage, it is a burden to want to exercise the currency function based on blockchain technology. It's like we just started launching rockets into space and wanted to use currency on Mars.

Hong Jixun said that the low level of use and adoption of cryptocurrency assets makes people question whether it is feasible and practical. In South Korea, many companies are trying to use government-supported blockchain policies to produce a technology that is not in high demand. He added at the end that trying to please the government by creating technology without realistic needs is ineffective; instead, the industry's current focus should be on driving organic growth in the actual use of blockchain and cryptocurrencies.

This article has been authorized for translation by DecryptMedia.com .

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