Opinion: What is the key to large-scale adoption of blockchain?

Predicting the future is like gambling, you always have the possibility of being beaten. This is especially true in the fields of cryptocurrencies and blockchain. As a cryptocurrency, Bitcoin has been opposed by many people due to the huge volatility of its value, and the blockchain has been difficult to get ahead because of its relationship with Bitcoin. But George Gilder, co-founder of the Seattle Discovery Institute, said:

Blockchain is the future, and it will help us transcend the 'Google era' and lead the world.

(Image source: pixabay )

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This is a point of view. In order to make the blockchain truly the next "global architecture of value exchange and value democratization", large-scale adoption in a relatively short period of time is the key to its success. But what will the future of blockchain and cryptocurrencies look like in the wave of mass adoption? As companies such as Facebook and JPMorgan Chase launch their own cryptocurrencies, can these companies retain the basic principles of blockchain decentralization or will they modify it further?

This is a topic of endless debate in the blockchain industry, and I mentioned it in a keynote speech at the World Economic Forum in Davos last year. I also contacted industry leaders and my friends, such as Tim Draper, Alex Mashinsky, Miko Matsumura, and Roger Ver, to learn how they evaluated the industry as a whole.

The foundation of blockchain technology

First, let's look at the foundation of blockchain technology: the information in the blockchain is not stored in any center or single entity (making it difficult for hackers to get started), it can be updated in real time as a global shared database. Cryptocurrencies use this technology to create shared decentralized ledger systems.

For a system that values ​​data sharing, equality, and decentralization in nature, large-scale adoption by digital conglomerates such as Facebook may pose a potential threat to it.

As one of the most powerful companies in the world, Facebook has been collecting data extensively since its inception and is about to release a monetization tool. Any of its products that put personal data at risk are potential threats to users. Facebook's Libra is equivalent to a cryptocurrency. At a time when people generally don't trust the central bank, Facebook has changed a gameplay, but its essence is to let users trust their money to a centralized entity. Only members of the Libra Association can read the blockchain information in it, so that the Libra Association becomes a huge central bank. The development of Libra makes people doubt whether the decentralized cryptocurrency can be adopted on a large scale in the future.

How does blockchain technology work?

Let's see why decentralized blockchains will play a vital role in future data sharing. After explaining the basic blockchain technology, everyone should be able to realize that blockchain actually solves the problems that are common in the "Google era", such as the security of the Internet, the high degree of centralization of economic rights, and excessive transaction costs. Therefore, Gilder said that Google's era as a middle party may soon end. In addition, the blockchain is also a safe and interoperable tool, which can protect the privacy of users and promote better development of the community. Dr. Andreas Freund once said that the ability of the blockchain to "record" everything in its ecosystem can facilitate users to better share.

In January this year, the World Economic Forum launched a central bank digital currency policy maker toolkit. Sheila Warren, head of blockchain and distributed ledger technology at the World Economic Forum, said that the original purpose of issuing this framework was to better understand the potential impact of digital currencies issued by central banks on the global economy. Digital currencies improve the transmission, reporting, and traceability of financial data. In addition, the European Central Bank (ECB) President Christine Lagarde also acknowledged that in order to achieve low-cost cross-border payments in a very short period of time, the demand for central bank digital currencies is huge.

What is the key to large-scale blockchain adoption

So what is the key to large-scale adoption of blockchain technology? Chuck Ng, the chief information officer of a blockchain project, said that there are three main factors driving the large-scale blockchain technology: the public's trust in the value of the blockchain, the increase in blockchain scalability, and the increase in regulatory transparency.

By understanding Gartner's hype cycle, you will find that any valuable thing can continue to thrive after the bubble burst, and eventually be applied to people's daily life and work.

By observing the route taken by the Internet, we can get a lot of valuable information. In order for blockchain technology to be embedded in the daily lives of users, it must be interoperable, easy to navigate, and most importantly, it must have super high productivity.

Can the blockchain really realize its value proposition?

Matthew Graham, CEO of blockchain consulting firm Sino Global Capital, believes that Huobi Exchange will tend to adjust to regulatory requirements in the future, which may cause it to lose the trust of overseas customers. However, in the future, this trend may become a common phenomenon. An industry insider has predicted the future of cryptocurrencies, and they believe that governments will use this technology in 10 to 20 years to control the flow of funds globally. However, this is definitely contrary to the basic principles of blockchain technology.

Naval Ravikant concluded in his tweet that a blockchain controlled by "a country, a business, an elite, or a mob" is a completely meaningless idea. This is because the basic idea behind the technology is that everyone is equal before decentralization. An authoritarian government may use its cryptocurrency, which has sole control, to exercise overall power politically and financially over citizens. Decentralization is the key to balancing the usually omnipotent systems in the world.

Perspectives from industry leaders

Here's what other industry leaders think about this important topic:

Tim Draper, founder of Draper Associates, DFJ, Draper University, and Draper Venture Network:

Bitcoin is great, and when Lightning Network and OpenNode start delivering, more people will use Bitcoin to pay. In fact, OpenNode claims that their Bitcoin network will be faster than VISA. Facebook is trying something great, but it will still be centralized, and Bitcoin will be decentralized, so people will trust Bitcoin more. I think that after the launch of OpenNode, Amazon, Apple, etc. will adopt Bitcoin instead of issuing their own cryptocurrencies like Facebook to experience regulatory nightmares. Let's see how many large companies, such as JP Morgan Chase, know when they find a new technology better than the way they treat customers. Merchants would choose Bitcoin. When someone swipes a reference card, JPMorgan Chase can get 4% of the money. Once merchants start using bitcoin, they will no longer need to pay fees. JPMorgan needs to figure out what they will look like in the post-banking world.

Bitcoin.com CEO and angel investor Roger Ver:

I was very excited when I came across Bitcoin in 2011. I think its revolutionary reason is that it has the potential to become an unlicensed currency for the entire world. It is decentralized, which means that no one can control the Bitcoin network; transactions cannot be censored, and no third party is required to process payments. If we are to reach the stage of true mass adoption, we need a better user experience than existing systems, otherwise people will not use cryptocurrencies. We have to make them more useful than Swish, Paypal, Visa, and this is exactly what we are trying to do on Bitcoin.com.

The future of blockchain depends on you

Decentralized cryptocurrencies are predicted to grow rapidly as a parallel economy and have the support of some countries and some people. However, many insiders believe that in the future, shared and distributed transaction technologies such as blockchain will face many competitors. Ease of use will make cryptocurrencies more accessible, and a disruptive combination of old systems and new ideas will promote the large-scale adoption of blockchain technology and maintain its basic characteristics.

Most importantly, the future of cryptocurrencies and blockchain depends on the path they choose today.

The above opinions, ideas and opinions are only the author's personal opinions and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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