By Dennis H. Lewis
These days, it seems everyone is talking about cryptocurrencies, but how many are actually using them?
For all the interest swirling around the blockchain, the technology has several challenges to overcome before it can attain widespread adoption outside of its current niche of highly knowledgeable users. But this could be set to change soon with the introduction of a new breed of apps that combine common functionality such as instant messaging with a digital wallet for cryptocurrencies. Could such apps help cryptocurrencies finally break into the mainstream?
What is holding back the adoption of cryptocurrencies in Canada?
One of the most popular uses for mobile phones among Canadian internet users is mobile messaging, with more than half of users (52%) reporting they used messaging services. Indeed, the number of messaging app users in Canada has grown by approximately 2 million every year since 2014, and the total number of users is projected to top 20 million by the year 2019. Another popular activity among Canadian internet users has been mobile banking: 43% of users said they used mobile banking on their device, making it the 5th most popular activity. You can see from these statistics that Canadians are not just using their mobiles for fun or for phone calls, they are using them for vital day-to-day functions such as banking and instant communications.
With the clear enthusiasm and comfort Canadians have with using their mobile phones for both social and banking activities, you might think that adoption of cryptocurrencies would be an easy sell. However, cryptocurrencies have yet to realize their potential to break into mainstream awareness. An average user may be aware of Bitcoin and have a rough idea what a cryptocurrency is, but they aren’t yet ready to adopt it for their own use. Why is this?
There are a few reasons that cryptocurrencies aren’t yet widely adopted in Canada:
- Cryptocurrencies can be difficult to understand, with the average person struggling to make sense of the various steps involved in how cryptocurrencies are generated, traded, and stored. The full understanding of the ins and outs of cryptocurrencies requires expert knowledge which is beyond the scope of most people, which is why to date cryptocurrencies have mainly appealed to individuals with a high degree of technical knowledge rather than the general public.
- The difficulty of actually obtaining a store of cryptocurrency is prohibitive. In most cases, users have to go through a long and somewhat complex process just to acquire cryptocurrency. Such “hoop jumping” is counter-intuitive for most. There is not a simple way to convert standard currency into cryptocurrency to get people started, either.
- Even if users do manage to acquire cryptocurrency, there are limited ways in which they can spend it. Other than a smattering of businesses which either service customers with extreme privacy concerns or are run by technology enthusiasts, most companies do not accept cryptocurrency as payment for their goods or services. It’s also a challenge for businesses to find a way that they can accept cryptocurrencies as payment from their customers.
- And finally, there’s the elephant in the room when it comes to cryptocurrency: volatility. Due to their speculative nature, cryptocurrencies are subject to extreme fluctuations in value, meaning that a currency can be worth a lot more or less one day than it was previously, and these changes can happen in very short amounts of time. This volatility is off-putting to many users — even those with the technical knowledge to use cryptocurrency — because of the worry that money put into cryptocurrency might be lost.
Could a new approach to cryptocurrency encourage adoption?
It’s plain to see that there is massive potential for Canadian users to engage with both finance management and instant messaging on their mobiles, but there are several challenges to overcome with regards to the adoption of cryptocurrency.
There is reason for rising optimism, however, as a new breed of mobile apps is emerging that aim to mitigate the aforementioned challenges. Last year saw one of the biggest and most talked-about ICOs from a consumer internet company launched on Ethereum: Kik Messenger, a Canadian-based messaging app that raised nearly $100 million from its token sale. The popularity of the Kik app has introduced a whole new generation of messaging users to the blockchain and is driving adoption of blockchain technologies among mobile users.
Other messaging apps in the process of development include Dust, a chat app which will soon incorporate aspects of the Mercury Protocol blockchain messaging technology; and Blockom, a privacy-centered messaging platform which uses blockchain to protect the identities of its users. Also coming soon is SuchApp, a new mobile app which combines both instant messaging features and a cryptocurrency digital wallet. It’s poised to potentially bridge the gap and bring cryptocurrency into the Canadian mainstream.
The big advantage these apps afford when it comes to encouraging cryptocurrency user adoption is simplicity. Systems like those used by SuchApp are as easy to understand as traditional loyalty programs like frequent flier miles, putting the concept of cryptocurrency into a familiar format. Users don’t have to worry about the technical difficulties of obtaining or spending cryptocurrency; instead, they can buy currency with the app or they can earn it through loyalty programs and referral awards. The app handles all of the complexity and volatility and leaves users with just the functionality they want. The system is designed for e-commerce, requiring little in the way of technical expertise from either users or merchants, and loyalty programs in some apps can be created with just a few clicks.
The integration of a digital wallet into a messaging app means that users can easily send money to their contacts for everyday occurrences, such as splitting a bill among friends. And even better, the wallet can be used for making payments directly to businesses. Businesses can swiftly set up a loyalty and payment program through which their customers can both pay for their goods with cryptocurrency and simultaneously take advantage of loyalty scheme offers like discounts or free bonuses.
The combination of ease of use and complex functionality that these apps offer has the potential to kick-start widespread adoption of cryptocurrencies, especially among casual mobile users. And with Canadian citizens actively embracing mobile messaging and banking, these kinds of sophisticated hybrid apps may just be the unexpected key to taking cryptocurrency into the mainstream.
Dennis H. Lewis is a seasoned digital storyteller and ICO marketing specialist with a proven track record in both Europe and the United States. He has successfully lead to market and exited multiple startup companies, and prides himself on his ability to make complex projects easy to understand and relatable. In a marketing landscape increasingly obsessed with shiny objects and overly complicated sales funnels, Dennis still believes that the key to any successful marketing campaign are the words on the page.
