The Missing Element to Stabilise Crypto Finance — Value V Usability
Welcome to our first release of our Missing Element series!
We promised to look into the particularly controversial crypto feud first started by Bitcoin Vs Bitcoin Cash, and deal with the ongoing question: High coin value or High coin usability?
As a hybrid company with hybrid projects, a hybrid economy and a hybrid ecosystem we believe that this feud would not exist in a more established industry. Yet, we digress. The question we asked you was: “Why Choose?” and we will answer.
To answer it well, we will need to understand why it’s the wrong question to ask. For this, we need to look into who we’re doing this for, and discover what they’re looking for — what you’re looking for. By doing this, we will be able to tell you definitively that the root of the issue is not coin value Vs coin usability, but rather the shortcomings of DeFi technology, and its mass adoption appeal.
The War of Utilities
Originally, when it came to currencies like Bitcoin, their value was like that of Gold, a safe haven not just for cryptocurrencies but for traditional currencies, a philosophy which kept such currencies at a much higher value than Cash counterparts that offer usability rather than investment value.
However, in the past year this relationship of crypto/gold has begun to shift. These currencies’ values are starting to look and feel more in line with the traditional stock market, moving alongside it even in times of downward slumps. So, unlike Gold rising when USD fell, crypto currencies fell as well.
Suddenly the appeal of this “alternative gold” begins to fade, bringing into doubt whether these currencies can ever rise to their previous heights, let alone surpass them.
This is where tokens come in. Unlike currencies like Bitcoin and Etherium, which are meant to be hoarded and kept for long stretches of time as an appreciating item of value, these tokens are meant to be used. They are meant to be shared, and they are meant to inject crypto into real, daily life.
However, for this to actually work there needs to be mass adoption. The market is in need of constant growth. Many different projects came to life in the wake of this realisation — each one appealing to investors through their tokenomics. Each one has been trying to find a way to entice investors with their reward pools and potential returns. This is where NFTs were born, and Play2Earn began its journey.
However, they all suffer from the same drawbacks. They all have finite reward pools. They all rely on a limited supply & demand — despite being able to achieve impressive results, these are reserved for a select few. The avenues for potential earnings are also very limited for all of them as they rely on existing elements of stock market behaviours.
This is rather strange, as the potential provided by DeFi and the Blockchain as well as the logic of tokenomics are actually much bigger than this. How much bigger? Now, there’s a question.
