Why We Need More Bitcoin Exchanges
Moving in and out of bitcoin is the lifeblood of the cryptocurrency industry — which is why the more bitcoin exchanges, the better.
Without exchanges, it’s difficult for people to move traditional money (like the US dollar) into bitcoin.
This is why a strong bitcoin exchange infrastructure is needed in order for cryptocurrencies to succeed.
While there are a number of great startups providing bitcoin exchange services, there needs to be more. Here’s why we need more exchanges in order to take bitcoin to the mainstream.
Exchanges Are the Entry and Exit
In order for people to get bitcoin for the first time, they need to convert cash into cryptocurrency. Sounds simple, doesn’t it?
Well, it’s not that easy.
Every transfer into bitcoin from regular money, whether via a bitcoin ATM, debit card or brokerage — requires an exchange of some sort in order to make transactions happen instantly. This is why we need more of them.
“The need for more exchanges will really present itself once bitcoin starts to get further supported by easier, better, and safer application systems.”
Unbanked Regions Need Exchanges
Bitcoin is a financial asset with some cash-like properties. People can bypass banks by using bitcoin and a mobile phone.
This makes it very advantageous to the unbanked.
Problem is, in order for bitcoin for the unbanked to become a reality there needs to be more exchanges in places where people primarily use cash. People need a way to trade in cash for bitcoin.
“I doubt more exchanges are needed in places like the US and EU. Lots of competition there, but of course countries that are still unserved need to be served.”
Exchanges Must Become More Versatile
The majority of bitcoin exchanges on the planet today do one thing: Cash in, bitcoin out — and vice versa.
However, bitcoin has properties exchanges can offer features around.
From smart contracts to blockchain-based proof, bitcoin exchanges have an opportunity to engage users as a next-gen financial provider. Companies such as Coinbase doing just that, but there could be many more.
“What we probably need is more exchanges that offer innovative technological features, besides being just an exchange.”
Exchanges Must Cater to the Mainstream
Some exchanges today only focus on liquidity and trading tools in order to cater to professional traders.
But if bitcoin is to become popular it can’t be all about traders.
The vast majority are not going to want to buy and sell bitcoin on a fast-paced market. People want to move in and out of bitcoin with simplicity, free from complication. Exchanges must offer this to spread adoption.
“I think in the future there will be a few international big exchanges for professional trading. Most of bitcoin users wouldn’t need exchanges if they had other simpler ways to acquire bitcoins.”
Bottom line? The bitcoin exchange infrastructure is growing and getting better everday.
However, the bitcoin exchange ecosystem needs more. It needs increased entry/exit points, exchanges in unbanked regions and more cryptocurrency-based services.
Exchanges also need to make sure mainstream users are satisfied with the experience.
