Based on eToro (trading platform) press release, it has recently noted there is a strong possibility that cryptocurrenciessuch as Bitcoin (BTC) can become a main stream mode of payment as it meets one criterion of money. This statementwas in a conjunction with the study conducted Imperial College.
As cited in the report, “Cryptocurrencies: Overcoming Barriers to Trust and Adoption,” drafted by Prof. William Knottenbelt of Imperial College London and Dr. Zeynep Gurguc of Imperial College Business School, cryptocurrencies aresimilar to the use of money and potentially can be used as main stream payment tool in a decade’s time.
The report cited cryptocurrencies have shown to fulfill one of three general principles of fiat money, which is having astore of value. However, the two other requirements are not yet achieved such as being a medium of exchange and
used as a unit of account.
The study stressed Bitcoin, along with other cryptocurrencies have to respond to the six challenges to attain the money requirements such as scalability, usability, regulation, volatility, incentives, and privacy.
The report said this emerging payment system, including the asset types, did not happen overnight. Iqbal Gandham,managing director of eToro, noted the first email was created in 1971. It had to wait three decades “to become commonplace with a user-friendly interface.”
Gandham, who is also chair of CryptoUK, said it about eight years before the first Bitcoin transaction was made. In today’s scenario, we are witnessing how it meets the requirements of daily money.
With cryptocurrency’s capacity to be adopted as cross-border payments, he added this is a good sign that cryptocurrencies would soon be part of the main stream.
For Prof. William Knottenbelt of Imperial College, he said cryptocurrencies have the tendency to “upend everything” based on our understanding of the financial systems and financial assets. He stressed their decentralized feature.
Previously, Agustin Carstens, head of the Bank for International Settlements (BIS), noted cryptocurrencies “cannot assume the functions of money.”
He warned the “young people” about creating their money. In June this year, BIS drafted a 24-page paper regarding this issue, detailing the Bitcoin’s scalability challenges.
The article stressed cryptocurrencies cannot be scaled adequately to shift as a medium of exchange in our financial economy worldwide.