Blockchain technology has been in existence for close to 10 years now. Yet adoption levels are still low. Ex-president and board member of overstock.com shares his perspective.
Perspectives of an Early Adopter
October 31st was celebrated as the 10th anniversary of the Bitcoin white paper being published by the mysterious Satoshi Nakamoto. By January of 2009, the initial version of the protocol was released.
However, we are still far from its mass adoption. Overstock.com was one of the major early adopters of bitcoin as a method of payment.
Jonathan Johnson, the ex-president and board member at Overstock and President at Medici Ventures was part of the decision to embrace the technology.
In an article published on Techcrunch, Johnson shared the three challenges that according to him need to be addressed before the full potential of blockchain technology can be realized.
According to Johnson, Overstock was quick to realize the long-term potential of blockchain. The firm also understood that for broader adoption, start-ups in the space would need not only financial but also human capital.
To fill this gap, Overstock had set up Medici Ventures, a venture capital blockchain incubator. The firm is supporting start-ups in domains including capital markets, money transmission, and banking, voting, supply chain, property, and self-sovereign identity.
Hurdles to Adoption
In Johnson’s view, three challenges that are preventing the blockchain technology from having a broader impact are:
The shortage of good blockchain developers: According to Johnson, the demand for software engineers is growing as we become more dependent on computers and technology. Because blockchain is a new technology, it’s difficult to find developers who are skilled in it.
Johnson shares that Medici Ventures conducts regular training programs that include participants from different industries. This approach helps in sharing knowledge and in building the required human capital.
The attitude of Regulators: Johnson believes that legislators becoming aware of blockchain technology and its benefits is a good thing for adoption. But at the same time, the clamor for regulating any new technology stifles innovation.
He cites the example of the crackdown by SEC on US-based ICOs. The regulator believes that most of the tokens are securities and should comply with applicable laws. This has dampened the spirit of entrepreneurship. Johnson argues that the reason why the internet became a powerful medium of change is that regulation was not thrust upon it.
Attaining critical mass: For blockchain technology to find wider adoption, the real-world use of wallets and cryptocurrencies is a must, believes Johnson. However, for that to happen the number of shoppers and merchants that accept cryptocurrencies needs to increase.
Currently, we are kind of stuck in a chicken and egg situation, and most people that hold cryptos are just speculative investors.
Johnson believes that once critical mass is achieved, exponential growth will follow. While he is excited to see instances of adoption like the US state of West Virginia enabling overseas citizens to vote remotely, he believes that we are still far from declaring blockchain a “mainstream technology.”
In Johnson’s words:
We’ll know blockchain technology has become mainstream when we are no longer talking about it, but we are simply using it in everyday ways.
Do you agree with the views expressed by Johnson? Let us know in the comments below.
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