A future where bitcoin is fully adopted and accepted is a future that looks very different from our world today. If you only consider the implications bitcoin will bring to the banking and financial services industry, you are only looking at bitcoin as a payment system.

Bitcoin technology will essentially allow a redesign of society where our infrastructure for sharing information and resources will not hinge on a central party. Our business models will become incredibly resilient and far more secure from the breach of hacking attempts, although emphasis on information security will increasingly become a top priority. Banking, both commercial and central, will feel disruption to the core and will be forced to align their business models to a type of currency which resides on a decentralized network. Many of our existing institutions will be uprooted, some will make the necessary changes in their business models to adapt to changing economic landscapes. Most will not.

As a still infant monetary experiment, bitcoin has seen explosive growth in acceptance and interest worldwide. As this experiment continues to unfold, bitcoin has the potential to usurp conventionally used currencies in many areas of developing countries. We’ve even seen goods & services priced in bitcoin instead of being denominated in dollars, euros, or yen.

No longer will physical robberies exist, but rather thefts of the cyber domain will take center stage. Massive heists will be possible when hackers break the cracks in poorly developed software and the businesses which rely on them.

Not only will the security of storing financial information make a dramatic shift, but the security involved in completing a transaction will be hastened towards methods verified through biometric identification (a form of identification through physiological traits unique to the individual). Previously researched forms of biometric identification include fingerprint authentication, retina scanning, and voice tone activation. These methods of identification will be a more efficient way of verifying our identities. However, they will come at the cost of permanent identification through biological characteristics, something mainstream society will view with an amount of uncertainty, yet still partake in this transition.

Our current understanding of where bitcoin will carry society is still very convoluted. There are no definitive directions that tell us how technology will have changed our lives in a decade’s time. No one could have predicted with perfect accuracy the types of applications we use today with the internet TCP/IP and DNS infrastructures built in the early days of development. Bitcoin is a reflection of this evolution in technology. As it now stands, the trend seems to be moving toward trustless networks where users are empowered and responsible for their own information.

With more individual power, comes greater responsibility.

If businesses and governments are able to take full advantage of the innovative features the bitcoin payment system makes possible, society will become a far more interconnected while the speed of exchange between businesses and individuals will take a giant leap forward. In comparison to today’s so-called global economy, the behavior of resources will operate on a frictionless, less authoritative system of wealth transfer.

While bitcoin for the time being remains outside the realm of feasibility for citizens who are not computer competent, they may opt to trust external institutions to store and manage cryptocurrency on their behalf, be these institutions private or government establishments. Because of this, regulation will largely be targeted at the exchange and money services businesses in order to control the identity and flow of cryptocurrency.

What about the poor? Can those living at poverty levels and on fixed incomes afford bitcoin? Will the rich get richer and the poor get poorer in a bitcoin-based economy? Seeing as the digital economy is one made available wherever internet connectivity is possible and no barriers or discrimination to entry exist for wealthy or poor citizens, it would seem cryptocurrency would raise the global tide of welfare, effectively lifting all boats. The poor would have just as much access and usability for the bitcoin network as the extremely wealthy and, unlike conventional capitalistic structures, money would not systemically flow toward those with the [already] greatest financial abundance.

If you treat your bitcoin well (by storing them safely), and if you desire to increase your holdings of bitcoin (through adding value to the economy), then the rich will have no discriminate advantage over the poor in such a system given that all involved have necessary access to technological and financial services.

We have seen a similar trend of non-discriminatory technology before. As services based on information technology become refined and improved, they are also made available to a wider audience at lower costs. For example, in the 1980s a person carrying a cellphone was considered of high socioeconomic class. Today,
smartphone technology is omnipresent in the developed world and growing rapidly in the developing nations. Technology starts out inefficient and progressively moves toward cheap and efficient access for everyone.

Most early adopters will be quick to admit we are still in an infant stage of digital currency and blockchain technology itself. The price may have seen massive fluctuations and appreciation, however, the infrastructure, the community, and the price equilibrium of bitcoin have yet to be fully realized. The lands of cryptocurrency are still ripe with opportunity and it would be a mistake to wait for the perfect time to enter an emerging trend. At this point no choice is the worst choice of all. Cryptocurrency is a brand new industry, and it remains completely wide open.

Among the many opportunities is that of educating the general public who still hold a distorted outlook on bitcoin. Ask someone on the street if they have heard of bitcoin and if they have, ask them to explain to you what it is. Ask the merchant if they accept bitcoin next time you go to pay for something, and you will be able to judge where the adoption of cryptocurrencies lie within your community. This type of market research will give you a general sense of the adoption of bitcoin, and the research conducted since the very early days shows an undeniable, rapidly adoption and uptake in the understanding of bitcoin and digital currency. Especially among the younger generations, people seem to be able to bridge the gap between national currencies and nonpolitical, cryptocurrencies.

Cryptocurrency is still just making the leap, vying to be known and widely used. Cryptocurrency is in the process of crossing the chasm, making the transition between the early adopters and the early majority of market adoption. The newcomers are still just getting their feet wet. The water is cold, but it has an inviting feel.

Analyzing the various growth segments, cryptocurrencies are quite empirically not the domain of the majority in any way. The trend seems to lie somewhere at the midway point of early adoption. This estimate is made because of representation in media, changing public perception of the technology, and people meeting it
with curiosity and self-directed learning. The people who are building the bridge to cross into the majority of adoption are the entrepreneurs, computer scientists, and most importantly the users which are spreading understanding among their peers and communities and helping grow the market.

An easy thought experiment to try with someone who is attempting to understand cryptocurrency is to make the relation between email for communication and bitcoin for money. You require an email address to send and receive messages, and with bitcoin you require a bitcoin address to send and receive payments. Bitcoin then, can be thought of as email for money. This relation makes it easy for a newcomer to understand because we can relate it to something they already use frequently, and understand enough to displace previous modes of communication (or money) such as those that are physical and use central controls.

Adoption of new technologies has seen a reliable increase in the rate of commercial use in the last 100 years. It took only seven years from the first web pages in 1991 for the web to be used by a quarter of the American population. That compares with 46 years for electricity, 35 years for the phone and 26 years for television. (The Economist, 2014) Bitcoin, which can be seen as a system built on top of the internet, has been displaying patterns of adoption which make the internet pale in comparison to the speed at which people are experimenting and using digital money. As a study done by the Federal Reserve Board of Washington, D.C. shows, the number of daily users has grown exponentially in the past few years. In particular, coarse calculations suggest that the user base has doubled every 8 months for the last 3 years. (Federal Reserve Board, 2014) Much in the same way people now refer to physical mail as “snail mail”, will we soon be referring to physical currency as “snail money”?

From an adoption perspective, bitcoin has a great momentum in that it conveys the whole product concept. When you get down to the finer details, bitcoin clearly is more than just a lone financial instrument. It’s a framework to decentralize traditional business models whose power has been pinned to the centralized
monopolies.

As the network of bitcoin users expands, so too will the benefit for everyone involved as the system becomes increasingly valuable and more users join the fold. The network effects of bitcoin allow everyone to benefit as more people begin accepting and exchange in digital currencies.

Online social services operate in a similar way. Twitter, Facebook, and LinkedIn are more useful as more people join their ranks. Facebook would hardly be valuable if there were only a few hundred who used it. Facebook is valuable because it now offers the ability to reach out to most of the people you have ever met in the developed world. Bitcoin operates in a similar way. The more merchants and individuals that are willing to accept bitcoin as payment, the higher people will value it as a medium of exchange, incentivizing new entrants to the market and increasing demand. Over time, this creates a momentum effect as more users join the positive feedback loop.

When can we expect bitcoin to be more adoptable by the mainstream consumer?

Consider the falling costs and increasing usability of computer technology as the tools and understanding have become much more readily available. In the 1960’s, an IBM computer would have filled an entire room and cost millions of dollars to own. This made it impractical for the common person and well out of budget for the average household. However, computers today are marvelously more powerful than they were in the past and consumers are able to access vast amounts of computing power for decreasing costs. More importantly, consumers are able to use these technologies without an intricate understanding of the underlying infrastructure which powers these systems.

Content management software such as WordPress have made publishing content to the web easier than ever and available to people with limited understandings of programming, web development, and computer competency. These types of applications serve to simplify otherwise difficult tasks and take the grunt work out of
difficult frameworks which would otherwise be outside the grasp of mainstream audiences. We can expect a simplification in the use of cryptocurrencies where mainstream consumers will enter the market for the first time due to a transition toward user-friendliness, which is a primary ingredient when technologies move into a disruptive phase. In this phase, we will begin to see large institutional players acknowledge the legitimacy of digital currency as a financial asset and begin trading in it, investing in it, and creating infrastructure around it.

Economies of scale combined with Moore’s Law allow the common person to now enjoy the benefits of computing which would have previously been unaffordable and far too complex. When this phenomenon is applied to bitcoin it is clear to see it will also become more user-friendly to the average consumer. Interestingly,
the network will remain open and accessible to all, and as networks of trust built around currency go, bitcoin will become increasing valuable as the trend in adoption will drive merchants to accept and exchange in it. Bitcoin will get easier to use, but will become increasingly scarce and therefore more valuable.

The bitcoin payment system requires no new investors to make it serve its purpose. It has demonstrated its utility for sending financial information across a digital network, and has proven to be an eloquent solution to many shortcomings of 20th century payment systems. The early adopters benefit because, as always, the people with strong ties to resources of information and (more importantly) the ability to recognize patterns within that information, reap immense rewards.