
Bitcoin is a household name now, 10 years after its inception. Although there are thousands of other tokens in the market, the crypto industry is still far from the road to mass adoption. Since the 2017 bull run, many technology enthusiasts and early adopters have joined the crypto bandwagon. However, we are yet to cross the chasm to reach a level of adoption that is inevitable. Most crypto transactions today are done by traders who want to gain through price fluctuations.
There are various reasons for this gnawing lack of adoption. Scalability, user-friendliness, and volatility are some of them. But one of the major reasons is the high trading fees in the crypto space. High volume traders do not mind because they can still make a higher return. But quite a lot are deterred because of the exorbitantly high trading fees.
Be it any technology, not only cryptocurrency — attaining widespread adoption and market traction is about having a clear and unique use-case that solves problems for a large number of people. For instance, the mass adoption of the telephone. A huge number of people wanted to communicate worldwide because it solved the problem of physically sending post-cards or mails. At the initial stages, new technology is always expensive. But with adoption and with new startups offering more efficient services, the cost of owning and operating a telephone line went down. With this came mass adoption. This is a cycle that every new technology goes through. It is called crossing the chasm.
Factors that will help mass adoption happen in the near future are mobile capabilities, remittances, passive income options via staking and mining, and the decreasing trust in traditional financial systems.
How is the Cost Of Service Affecting Mass Adoption?
One factor that prevents the mass market and especially the lower income group to participate in the crypto market is the cost of service in trading. It has been seen time and again that exchanges charge extremely high fees. One analyst noted that the fees can be as high as 48 times. It is widely known that crypto exchanges charge anywhere between 0.25 to 1% fees on every trade. Plus, there is a 5–7% fee for converting fiat to crypto. A user also has to factor the fee for converting crypto to fiat if they want to book their profits in fiat money. That is another 5–7%. Overall, a low-income user ends up losing and hence stays away from this market.

These are also signs of a nascent or fledgling market. As maturity sets in, and exchanges gain momentum, fees will reduce.
Another factor is government restrictions. The traditional financial market lobbies governments in various countries to prevent the adoption of cryptocurrencies. Regulatory compliance also increases cost and this is eventually passed down to the customers. As Alex Kruger analyzes, the fees paid by US crypto traders are higher than fees paid in some other countries.
One of the possible reasons for high fees is also the fact that crypto custody is more expensive. This is because centralized exchanges need to be fully responsible and opt for cold storage, world-class security for their trading platforms and various risk management processes. All of this affects mass adoption.
Zero-fee crypto trading
As the market gets more competitive, innovations like zero-fee crypto trading are bound to become an instant hit. What this implies is that users can freely store and trade their crypto on certain exchanges that would offer this zero-fee environment. This is to encourage new users in newer geographies to join the cryptocurrency movement that started with Bitcoin. By eliminating the costs of storing crypto in their wallets, remitting it to other folks across the globe, and by making the experience costless, millions of folks will be willing to try it out.
Users need to first try out the above model and only then will they realize that cryptocurrencies are so much better than fiat currencies and conventional banking transactions. This is what will make them switch from using fiat to crypto and spread the word about their new discovery.
One such company is Aximetria, a Switzerland-based fintech company focused on creating mobile solutions for crypto users including a crypto exchange, remittances and passive income, and a great overall experience with zero-fees. Aximetria is a great example of a company that is driving adoption in the developing economies in places such as Latin America and other world regions.
Alexey Ermakov, founding CEO at Aximetria explains: “Many people talk about the mass adoption of cryptocurrencies. To achieve this, the regulation was created, as were stablecoins, along with other important steps that took place in making this happen — and Aximetria adopted these policies, too. However, the main factor limiting mass adoption is still the cost of the service, making cryptocurrency too expensive to compete with neobanks like Revolut or N26, in cases when it comes to daily use by people around the world. We conducted a study among users that showed interest in crypto, but who never made a single transaction. It turned out that if they were offered to make transactions for free, the number of users who would then complete transactions would grow by almost 300% in contrast to wealthier customers who could already afford existing commissions. Now that option is finally available, removing a key barrier and opening up the convenience and reliability of cryptocurrency transactions to anyone.”
Conclusion
Mass adoption is the holy grail for any technology and cryptocurrencies are no different. The players who will drive market adoption will emerge to be the winners in the long run. Zero-fee crypto trading is an amazing way to do that. Companies undertaking such customer-centric innovation will eventually win a bigger pie of the whole market.
