The big players couldn’t even find a peer-to-peer crypto. PayPal and Venmo (which owns PayPal) have been claiming to support crypto since early 2021. But a closer look at their services reveals that although the platform allows US customers to buy, sell or trade crypto – investments, basically – they cannot send. Pay other users directly with crypto or coins. PayPal users who qualify can use the crypto for purchase only by converting it into fiat currency. If “the future of money is here,” as Coinbase claims on its website, then obviously not as much as regular people can do with money in the future.
Although cryptocurrency is difficult to spend, It is still very easy to lose, and as the industry grows, so does the loss. Without protections set up in traditional financial systems (such as the Know Your Customer, or KYC, protocols required for financial transactions requiring identity verification), fraudsters spend crypto investors-mostly individuals like those advertising targets છેલ્લા over the last 14 billion. , Lost almost twice as much as last year. The damage is constantly increasing. For example, in late March, Sky Mavis reported that a hacker had stolen કર 625 million worth of cryptocurrencies from a blockchain behind his pay-to-play game AxieInfinity.
Even if their wallets are not hacked or their crypto assets are not liquidated, individuals face the risk of extreme volatility in crypto markets; The value of Bitcoin has fallen more than 20% in a single day in the last six months alone.
“I’m worried about access; I’m concerned about abuse, “says Afua Bruce, a social policy and technology expert and author. The take that comes next“As we develop new technologies, we need to find out who the communities we are building are. Can they use it? What does durability look like? How is it really empowering the communities we tell that we are building? I don’t know if those questions for blockchain have been asked and answered.
In fact, the crypto industry’s relationship with its community seems predatory. “We” in “WAGMI” is a small group of speculative players who are getting rich from the risks taken by regular people. Indeed, as of December 2021, .01% of Bitcoin holders controlled 27% of the currency ઘ a much more distorted ratio than dollar ownership in the U.S., which is not a flattering figure to begin with. And because they are not supported by any real assets, cryptocurrencies increase in value as their demand increases. When more individuals choose to buy, VCs and crypto executives look up and down the trends of their own portfolios. Tech has many uses for marketing: it can raise awareness about new technologies or help build user base before monetization. Both of those things are happening in crypto. But if marketing persuades enough people to turn real money into cryptocurrencies, it can literally pay industry bills.
Crypto companies have already made billionaires out of their executive team – like Sam Bankman-Fried, the 30-year-old CEO of FTX who started his short career in traditional finance and is now valued at an estimated $ 24 billion. Bankman-Fried is currently the richest American in crypto, but there were six other “crypto billionaires” on Forbes’ 2021 list of richest Americans. And it’s only in the US; Binance CEO Changpeng Zhao, who has found a new foothold in Dubai since banning crypto, was worth $ 96 billion at the end of 2021 (but dropped to $ 63 billion in early April). While the Web3 pitch may promise an egalitarian utopia, the current distribution of crypto assets aligns more closely with end-stage capitalism. Crypto critic and author David Golambia says, “Capitalism is very happy to sell a real product and make a small profit on it. The politics of bitcoin“But he is even happier to sell a scam. Never underestimate the power of a lot of money and scam words to persuade a lot of people to do something. “
“Never underestimate the power of a lot of money and scam vocabulary to persuade many people to do something.”
What happens next in regulation will significantly shape the future of consumer crypto. Last year, Facebook shut down its new cryptocurrency – Diem, formerly known as Libra – following a serious regulatory inquiry. It probably won’t be the last to go. Federal agencies have recently taken more-aggressive action against some crypto exchanges for offering what they consider to be unlicensed investment products, and in October 2021, the U.S. Department of Justice will look into how crypto markets facilitate illegal activities such as money. Task Force was established. In March, President Biden signed an executive order directing financial agencies to develop a fully regulatory strategy for crypto, and, like many other countries, the U.S. CBDC (“Central-Bank Digital Currency”) is considering creating a regulatory digital currency. ). This is not a cryptocurrency at all but can provide the same level of functionality. Currently, many crypto exchanges try to limit volatility by using private stablecoins – a class of cryptocurrencies that are tied to real assets such as dollars. If the U.S. If the CBDC makes it, it can compete with those coins or signal to the government to make them completely illegal. FTX CEO Bankman-Fried himself predicts that the decisions of the US Federal Reserve will be the biggest drivers of the crypto market in the coming months of 2022.
However, regulation has its limitations, as we have seen in traditional banking. With so much money invested in cryptocurrencies and Silicon Valley power players investing in its success, the industry could find a way to grow despite severe restrictions. Five years from today, Web3 startups may still be exploring how crypto can be useful to regular people, but we are all likely to experience the environmental and social effects of this turbulent moment for a long time to come.
While consumer crypto still looks like a full-fledged pioneer town with gold panning and snake-oil dealers, the non-consumer landscape presents a very different picture. Already, businesses such as corporate banking services, pharmaceutical giants, film development companies and international shipping companies are using blockchain for transparency and efficiency. Such efforts could bring older, slower and sometimes paper-based processes into the digital age and also help industries meet new regulatory requirements.
Ripple, a company with more than 500 employees in nine offices worldwide, is a case in point. Like many larger versions of Paymobil’s crypto-managed money-transfer service, Ripple uses its own blockchain token as a bridge between currencies, allowing operational reductions to hundreds of corporate customers, including Bank of America, Santander and Japan’s SBI Remit. Time zone differences and costs due to manual settlement procedures.
Unlike the radical rhetoric of its crypto contemporaries, Ripple Legacy uses the speed provided by digitized currencies to improve banking processes, not to change them. In line with this reform-not-replace trend, RippleX general manager Monica Long sees regulation over the next few years and also CBDC as part of the evolution of the blockchain for businesses and financial operations more generally. “Consumers and consumers alike will benefit from improved infrastructure, user experience, regulatory clarity and interoperability as the new common denominator becomes the crucial element in crypto finance,” she says.
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The most industry-transforming use case ever – although perhaps the least sizzling case – is probably the Medilager Network and its custodian organization, Chronicled. In 2013, the U.S. government passed the Drug Supply Chain Security Act, which states that by 2023 the pharma industry must create a digital system for tracking prescription drugs to prevent counterfeiting. Healthcare and life sciences are notorious for ancient, non-interoperable systems, and the requirements of the Act have demanded a whole new way of doing business. Susan Somerville, CEO of Chronicled, wondered if a private blockchain એક a closed, licensed system, unlike public blockchains like Bitcoin કરી could provide a secure, shared environment in which pharma players such as Pfizer and Gilead could work together. After years of working through commercial rules and goals, Chronicled launched the MediLedger Network, a group of major pharma companies, in 2019. Chronicled provides a range of services such as spoof-proof indexing of their tested product IDs and real-time public pricing updates. These compact solutions may not be what people typically associate with blockchain technology, but they are important in pharma. Somerville says, “Almost everyone thinks about these ultra-advanced ideas, and it’s hard to get there.” “But there’s a lot less sexy stuff that’s actually basic.”
The use of Ripple and Medilager’s blockchain means secure drugs and quick money transfers for regular people without anyone having to create a digital wallet or exchange coins. For customer crypto? If the deaf pitch of the industry for the financial revolution sounds too good to be true, then so be it. Unless it can provide affordable, everyday use for new coins and extended protection against fraud and scams, we’d better stick to cash and traditional banking systems than join the parade of crypto boosters marching through our screens and cities.
Rebecca Ackerman is a San Francisco-based writer, designer and artist,
Correction: An earlier version of this story states that users cannot pay for purchases on PayPal with cryptocurrency. The story has been updated to show that the first coin can be purchased with crypto on the platform by converting it into Fiat currency.