Factors Impacting the Adoption of Cryptocurrencies

Published in

The Capital

3 min readAug 2, 2022

Cryptocurrency and blockchain technology adoption are no exceptions to how technological innovations affect organizations and countries.

Let’s have a look at some of the common factors affecting the adoption of Bitcoin and other cryptocurrencies in this article.

Volatility

It had no meaningful price between January 2009 and March 2010, then by May 2010, it was less than $0.01. Sounds promising?

It was $1.00 nine to eleven months later. The skepticism persisted. People remained skeptical until it rose from $150 in October to $200 in November 2011, “mooning” to $1,242 on November 29, 2013.

The story went viral, but it is still unknown. It had rover between $340 and $530 by April 2014. Isn’t that a huge loss? Be patient.

Bitcoin was worth $2,000 on May 20, 2017. Here, joy, sadness, and confusion coexisted. During that time, CNBC published an article titled “If you bought $100 of bitcoin 7 years ago, you’d be sitting on $75 million now.”

We thought we’d seen it all, but on 1 September, 20 November, and 17 December of the same year, the prices will rise to $5,013.91, $8,100, and $19,783.06, respectively. By the 5th of February 2018, it had plummeted to $6,200.

This was the case until recently. Bitcoin’s all-time high is $64,800, and the current price as of 7 February 2022 is around $42k or higher. In practice, this is volatility. So, if we accept bitcoin, how do we protect our assets from this volatile market?

This is one of the primary reasons for the fight against this game-changer. Despite this, the “big brother’s” cumulative graph movement shows an upward trend.

Cybersecurity

Bitcoin can be traded on several exchanges, which can pose a risk to your asset if you keep it in the wallet of one of these exchanges.

Hot wallets are stored in the systems of exchanges. As a result, when you buy or sell crypto assets on such exchanges, and they have wallet options on such exchanges, they can be hacked. Several hacks have occurred over the years. Bitfinex, Crypto.com, Binance, Coinbase, and other exchanges have all been hacked.

This is not just a Bitcoin issue. All cryptocurrencies are affected. However, if it affects Bitcoin, it is taken more seriously due to the value associated with Bitcoin and what it represents.

Regulations

Not only has the legality status of cryptocurrency been under scrutiny but it has been long accepted that cryptocurrency would only survive and spur in countries with receptive regulatory environments.

What do you think will happen if the United States successfully established stable crypto regulations? This is not meant to be a slam of superiority, but rather to demonstrate how seriously nations are taking steps to regulate cryptocurrency.

Because it has not been done or the process has not yet begun, governments are prohibiting transactions involving the asset or advising their citizens to be cautious and liable for any loss or gain resulting from any transaction involving the crypto market.

Scalability

Because of its ability to provide a layer upon which scalable blockchains can be built, Ethereum has become a favorite. Cardano, Solana, and Avalanche, the “grandchildren” of Bitcoin, have demonstrated tremendous capability in this regard. What is the cause of the scalability issue?

This is related to the Bitcoin network’s limited ability to process large amounts of transaction data in a given amount of time. Remember that one of the major benefits of blockchain technologies is supposed to be a faster transaction rate. However, Bitcoin has yet to overcome it.

In Summary

Although many people are aware of cryptocurrency, only a few use it. The lack of widespread adoption of cryptocurrency will most likely limit its future growth. As a result, it is critical to comprehend the factors that influence cryptocurrency adoption decisions.