The cryptocurrency industry is pushing for a more equitable future of decentralized financial technology that can empower everyone equally. Its supporters are ardent backers of this cause and new headlines pop up almost every day highlighting how governments, enterprises and institutional investors are expressing their interest in the technology.
At the same time, new businesses continue to enter the space with innovative projects, and there’s a steady flow of traditional financial institutions making the move too, with the financial derivatives trading powerhouse MultiBank recently launching a crypto trading portal of its own.
Despite this, adoption of crypto seems to have stalled. As 2023 draws to a close, we are in the midst of an unprecedented period of market stagnation. The current crypto winter has endured for close to two years, and investors who enjoyed the heady days of the 2021 bull run are no longer to be seen, as asset prices remain well below their all-time highs.
Why Has Crypto Adoption Stalled?
Crypto remains a long way from mass adoption and there are a number of reasons why that’s the case. Perhaps the biggest issue is there is still a lack of awareness about crypto. The general public still needs to be educated about the benefits of digital assets and how they can improve people’s lives. The blockchain networks that underpin cryptocurrencies are extremely complex, and many people are still unsure how to interact with them.
The lack of regulation in the crypto industry continues to be a hurdle too. Because there are very few regulations governing the use of crypto, many people remain hesitant to invest in digital assets. There needs to be stronger regulation of crypto to protect consumers, investors, and businesses from criminal activities and scams, yet the decentralized nature of the industry makes it difficult to strike the right balance. If too many restrictions are placed on crypto, it will alienate those who support decentralization and stifle innovation.
Security risks continue to dog the crypto industry. While lots of people don’t understand crypto, they are well aware of the risks associated with holding it. Crypto users are advised to implement several layers of protection to secure their digital assets, and this can overwhelm many users. At the same time, the failures of crypto exchanges and DeFi service providers such as FTX and Celsius Finance over the last year and a half have also made consumers wary.
Another challenge may be the technology itself. DeFi especially is a world of complex platforms that requires a significant amount of skill and technical expertise to navigate, and this makes many consumers unwilling to explore the new financial services and opportunities it provides. For many users, it’s a struggle to set up and safeguard a digital wallet, let alone interact with a decentralized exchange platform to trade. Other concepts, such as yield farming and staking, are also little understood by users.
Last but not least, crypto faces challenges in terms of customer service, which is non-existent on many decentralized platforms that don’t have actual, human employees.
How TradFi Integration Helps
Crypto aspires to be a fully decentralized industry and wants to replace the traditional financial system. However, if crypto is to achieve mass adoption, it must instead focus on becoming more integrated with TradFi. New users need a simple onboarding experience, and stronger links with TradFi provide a path to this.
Centralized crypto exchanges such as Binance have worked hard to simplify the process of buying cryptocurrency for the first time, and with the launch of new players from the TradFi world, such as MultiBank, more institutional investors have a way to find their feet too.
Before entering the crypto industry, MultiBank made its name as a platform for trading derivatives, forex, commodities and stocks and shares. Its original trading platform was launched way back in 2005, and since then it has been committed to creating a trusted trading environment, acquiring more than 12 financial licenses globally and serving over a million customers.
With the launch of its crypto trading platform, MultiBank.io, the company intends to leverage its reputation as a trusted and licensed trading venue to ease the concerns of users who are still worried about the lack of regulation in crypto. It further enhances trust by providing every trader with access to a relationship manager, who can provide a more personalized experience and answer their questions. Of course, its familiar trading interface means experienced TradFi investors will feel right at home within its platform as they deal with digital assets for the first time.
TradFi Can Pave The Way
The crypto industry continues to be held back by many factors, including the lack of awareness, regulator uncertainty, security risks and technological complexity, causing adoption to hit a roadblock. However, the emergence of TradFi players is creating renewed hope that the crypto space may one day achieve its ambitious dreams.
As more institutions like MultiBank look to integrate crypto with their TradFi offerings, bringing with them greater regulatory oversight, trust and a simplified experience for users, digital assets can improve their reputation. That, in turn, will enable more people to see their potential first hand and hopefully, create a new wave of user adoption.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
Known for identifying cutting edge technologies, he is currently a Co-Founder of a startup and fundraiser for high potential early-stage companies. He is the Head of Research for Allocations for deep technology investments and an Angel Investor at Space Angels.
A frequent speaker at corporations, he has been a TEDx speaker, a Singularity University speaker and guest at numerous interviews for radio and podcasts. He is open to public speaking and advising engagements.