Cryptocurrency was conceived to transfer monetary value between parties at a faster rate. This obviously would appeal to more people. That is the paradox, as it was intended for hundreds of users and not thousands. According to CEO nanopay, Laurence Cooke, that is why it will never have a future in payments.
Cryptocurrency works alright with limited users. But when it became a craze among many, it lost its processing speed so much so that the users are not able to transmit payments effectively and efficiently.
Suffering from the hype, bitcoin is now slower and expensive. Moreover, as the cost of currency has gone up due to more demand, the cost of using the currency has also gone high. According to Cooke, for a transaction to be completed at a $0.05 fee, the value of single bitcoin should be $10 and not $10,000.
Cooke said that ironically, bitcoin’s success is the reason for it failure. The claims of faster and inexpensive payments made it popular in the beginning. But due to more usage bitcoin fails to deliver what it claimed, thus making it not a worthy choice.
Adding to this inherent glitch, cryptocurrency uses blockchain, which allows users to transact with parties they don’t know and don’t need to trust. This dents the all-important KYC process and encourages money laundering.
Those who consider cryptocurrency’s function as a store of value as the primary function should reconsider it. If they are looking for a new way to store value, digital value of currency makes more sense as a digital dollar would have same liquidity as the currency has today.
A digital dollar will also enable banks to continue offering the lending functions that people expect them too. Banks can effectively meet the customer’s demand of loan which is not possible in case of bitcoins.
Bitcoin works on the code what’s there is there. Trying to use bitcoin in place of dollar would be more than foolish. According to Cooke, it would outright cripple the economy.