The cryptocurrency markets have been a rollercoaster over the last few years. The hype of 2017 was quickly replaced by the crypto winter of 2018. Will 2019 be the year of cryptocurrency adoption?
Why Is Adoption Important?
Even though Bitcoin and blockchain technology have been around for 10 years, there is currently very little evidence of mainstream adoption.
Think about it: When you walk down your local high street, how many stores actually accept cryptocurrency as a payment method? The truth is that most people are buying crypto right now as a way to speculate. Now, there is nothing wrong with using crypto this way; however, speculation can only happen for so long. At some point, crypto needs to justify the market value given to it and achieve what it set out to do. That means that cryptocurrency needs to be used as digital cash.
The only way crypto can succeed in achieving its intended use case is through adoption, and that’s why adoption and crypto’s long-term success are intertwined.
Which Places in the World Could Adopt Crypto First?
How Many Consumers Own Cryptocurrency?
Share of respondents who own Bitcoin or a similar digital currency in selected countries in 2018
Many in the crypto community have put forward the idea that developing nations, especially if they have unstable fiat currencies, could be the most fertile locations for widespread cryptocurrency adoption. The main logic behind this argument is that fiat currency (unless you are ideologically opposed to it) works just fine in developed nations. With the cryptocurrency markets commonly swinging in value 10%+ per day, it is easy to see why most people believe that fiat is a better store of value and medium of exchange in commerce.
However, in some emerging markets, the local fiat currency is nowhere near as stable. In November 2018, the growing Argentinian inflation rate stood at 48% in just a single month. Things are even worse in Venezuela with the 2018 inflation rate standing at ~ one million percent. Compared to these drastic changes in purchasing power, the volatility seen with cryptocurrencies pales in comparison, making crypto a significantly more attractive store of value and medium of exchange versus certain local fiat currencies.
Already, fantastic work has been done by cryptocurrency projects such as Dash in countries like Venezuela. They have attempted to partner up with as many merchants as possible to spread the availability of Dash in the country. However, could there be another way to better sow the seeds of lasting crypto adoption in emerging markets?
A New Way to Get the World Using Crypto
Nimiq, the first browser-based blockchain, has recently sponsored TotalCrypto.io to devise a new ambitious plan and process to widen cryptocurrency adoption in economically challenged regions of the world.
“Many of the World’s problems are inextricably linked to human development issues. People limited with options, particularly when faced with banking challenges, are more likely to exploit the natural environment around them or turn to crime in order to provide for themselves and their family in the short term,” states Team Nimiq, continuing, “which is why the idea of exploring this real world impact potential beyond the speculative value of cryptocurrency is so important.”
The adoption plan proposes a case study approach, with one community being targeted at a time. The key is in creating a successful and repeatable process that can be replicated in other case study locations in the future. Success has the potential not only to elevate the status of the wider crypto markets in the mainstream media but it could also disrupt current models for charity and human development. The reason why is that the crypto adoption proposal is looking to achieve more than just mere adoption. It actually suggests ways that a crypto-powered solution could grow the local economy and enable locals to participate in the global digital economy.
What makes the adoption proposal so unique
- It’s completely open source – Both the wider crypto community and other crypto projects are invited to propose changes to the plan or even use it for their own crypto adoption initiatives. The research and proposal can, therefore, be viewed as a wider contribution to the crypto community, and Nimiq can welcome collaboration opportunities from other crypto projects.
- Scientific methods – Use of both case study and scientific research methods have been proposed.
- Collaboration with academic, entrepreneurial and charitable communities – The proposal suggests that the onboarding of other communities outside of the crypto universe would strengthen the final process, increase the chances of crypto adoption success and elevate the impact of the proposed case study.
- Methodology attempts to foster local economic growth – The proposal goes beyond adoption. It strives to bring about positive social change as well.
What’s the Overview of the Plan?
The adoption proposal can be broken down into three phases.
- Additional Research – Searching for case study locations of an appropriate size that have the highest chances of cryptocurrency adoption. It has been proposed that collaboration with the wider crypto community and academics would further strengthen this selection process.
- Partnership Formations and Outreach – Focused on onboarding additional academics, local charities and entrepreneurs to improve the chances of successful execution and enhance the academic value of the case study. These partnership formations would also play a key role in enhancing the mainstream appeal of the initiative to a wider non-crypto audience.
- Deployment – Is made up of all the steps required to make the adoption case study a reality. This covers everything from operational processes to safety precautions.
The main components of the proposed case study can be broken down into three key areas.
- Local exchange – To enable local currency to be converted into crypto and from crypto to fiat. Mechanisms have been built into the local exchange to incentivize locals to hold crypto. Its also been suggested that the exchange should serve a dual function by acting as a cryptocurrency educational center for locals too.
- Incubator – Serves as a method to stimulate the economy in the case study area. It’s been put forward that locals should be supported with the tools and ‘know how’ to create their own online businesses and engage in the global digital economy. Support from the entrepreneurial community will be key to the success of this initiative, and if successful, it would act as the gateway for new value to enter the local economy and trickle down to the local community.
- Real-Word Crypto Airdrop – The proposal suggests that everyone in the local community would be given some free crypto. The intention is for this to act as a local stimulus package and sow the seeds of free enterprise in the case study area.
The Next Steps?
There is no doubt that the crypto adoption proposal being considered by Nimiq is an ambitious one. Right now, the Nimiq Team is assessing various levels of support for the proposal before making a decision on how to proceed. The opportunity is there for anyone interested in crypto adoption to actively contribute to the initiative with their insights, or show support to make this vision a reality.
The truth is that no one knows ‘if’ or ‘how’ crypto adoption will happen. What’s important is that different approaches are considered and that the most promising ideas and concepts are pursued. Somehow, we don’t think the approach of ‘building and waiting for the people to come’ will be the optimal or fastest strategy for crypto adoption.
We do recommend that you take a bit of time out to read the full proposal, and we encourage you to provide your thoughts and insights on it. Together we can make 2019 the year of wider crypto adoption and positive change. The opportunity is there to possibly disrupt another traditional sector or two, and to show the mainstream media that crypto is not a niche reserved for money launderers and criminals.
Disclosure: The author holds some NIM in their portfolio and is compensated in a long-term independent consulting capacity by Nimiq. This article must not be construed as investment advice. Always do your own research.
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