Some of the limitations that cryptocurrencies presently face — such as the fact that one’s digital fortune can be erased by a computer crash, or that a virtual vault may be ransacked by a hacker — may be overcome in time through technological advances. What will be harder to surmount is the basic paradox that bedevils cryptocurrencies — the more popular they become, the more regulation and government scrutiny they are likely to attract, which erodes the fundamental premise for their existence.
While the number of merchants who accept cryptocurrencies has steadily increased, they are still very much in the minority. For cryptocurrencies to become more widely used, they have to first gain widespread acceptance among consumers. However, their relative complexity compared to conventional currencies will likely deter most people, except for the technologically adept.
A cryptocurrency that aspires to become part of the mainstream financial system may have to satisfy widely divergent criteria. It would need to be mathematically complex (to avoid fraud and hacker attacks) but easy for consumers to understand; decentralized but with adequate consumer safeguards and protection; and preserve user anonymity without being a conduit for tax evasion, money laundering and other nefarious activities. Since these are formidable criteria to satisfy, is it possible that the most popular cryptocurrency in a few years’ time could have attributes that fall in between heavily-regulated fiat currencies and today’s cryptocurrencies? While that possibility looks remote, there is little doubt that as the leading cryptocurrency at present, Bitcoin’s success (or lack thereof) in dealing with the challenges it faces may determine the fortunes of other cryptocurrencies in the years ahead. SBC Group believe that there is huge potential for SBC Coin to grow and ultimately mature in the cryptocurrency marketplace.