Cryptocurrencies: Bridging The Gap Between Dreams and Reality


We see a lot of exciting news about cryptocurrency and blockchain on a day to day basis, for believers like myself, it’s all a rave. On the other hand, it’s probably a good idea to be aware of all the possibilities.

Diffusion of innovation

According to Everett Rogers, who postulated in 1962, The Diffusion of Innovation Theory. There are four phases to the adoption of a new idea, product or behavior by society.

* First is adoption by innovators and early adopters. They make up 16% of the population. This group typically see’s value and opportunity to others.

* The second party to join the fray are the early majority. Characteristically, they are more skeptical than the ones before but they still want in.

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* Enter stage right, the “late majority”. Now, these guys and gals are properly skeptical and risk-averse.

*Last but not least we have the so-called “laggards”. They tenaciously lead every revolt against the inevitable, change.

 

What’s this got to do with Cryptocurrency and Blockchain?

 

Pretty much everything. We hear a lot of talk about investment, like the launch of BITCOIN futures in December 2017, or the 2000 BITCOIN ATM’s that popped up around the world. So in terms of investment, one might say we are at the point of ” early majority “.

 

The Blockchain though, like all new technology has its drawbacks. Mainly the problem of scaling. With the recent success of many ICOs and launched Blockchain applications, the result has made the network somewhat sluggish and might cause high transaction costs on the ETHERIUM blockchain. So in terms of tech ,we might only be in the” early adopter’ stage.

 

If this gap between currency and technology is not properly dealt with, it could cause an overvaluation of cryptocurrency. Even Vitalik Bruterin (Ethereum founder) recently questioned the growth by asking, “have we earned it?”. This gap means that blockchain networks still cannot handle the high transaction volumes that financial institutions and large industries need before they can fully accept the blockchain.

 

With that in the bag, we have Lightning Network, Raiden Network e.t.c, trying to tackle the problem, but growth has been hindered by the limited availability of qualified technologists.

 

A lot more has to be done on the part of training blockchain developers. Two institutions of higher learning in Singapore(the National University of Singapore and Singapore Management University) being pioneers in this regard. We also have to ” pay more ATTENTION “to scaling solutions.

 

If the chasm between technology and investment is too large for the former to catch up with the latter , the current rate of speculation around cryptocurrency could prove it’s Achilles heel.

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Joel Bonga

Joel is a believer in the potential of blockchain technology and finds crypto trading quite exciting. He is also a cofounder of Existence Digital, a technology distribution company.