Since the Bitcoin introduction in 2009, a number of businesses accepting and using cryptocurrencies have grown. However, although increasing, the cryptocurrency adoption rate is still far away from being massive. Currently, Bitcoin holds the top spot while several obstacles remain that block acceptance of cryptos.
Using various data sources, the number of businesses accepting cryptocurrencies have increased tenfold from 2013 to 2018. Although positive, the overall number of companies adopting the crypto is nowhere near the fiat currencies, USD and EUR. Main issues remain high price volatility, frequent scams/hacks, and lack of regulations.
Early Stages of Cryptocurrency Adoption
Started in 2009, the road of cryptocurrency adoption has been paved with bumps and obstacles. The entire industry, according to the CoinMarketCap data, did not pass $2 billion of total worth well into 2013. The number of organizations accepting bitcoins at that time ranged up to a thousand firms. The most notable purchase using bitcoins at that time was Papa John’s pizzas, worth 10.000 BTC in 2010.
In terms of blockchain-powered businesses, the first ever initial coin offering (ICO) was Mastercoin in July 2013. A year later, Ethereum was born, bringing in 3.700 BTC (approximately $2.3 million at the time). At the end of 2013, the overall value of crypto industry rose to over $15 billion. The real push happened at the end of 2017 when BTC hit $20.000. The ICO industry in 2017 also reached the record value, raising almost $2.5 billion.
The industry grew by value, especially at the end of 2017 when the whole market passed the $800 billion mark. Additionally, the number of businesses accepting cryptos rose to 8.200 in the same year according to the Coinmap’s cryptocurrency adoption analysis. However, compared to 25 million startups in US only, businesses accepting crypto was far away from massive adoption.
Situation Right Now
Compared to 2017, the current year saw a little change, if the big picture is taken into account. According to the same data from Coinmap, a number of businesses that accept digital coins rose to 11.344 in 2018. However, the database takes into account ICOs and exchanges, not just the mainstream industry companies, such as retail, manufacturers, and others.
On the other side, ICO organizations grew even bigger than last year, accumulating over $6 billion so far. Additionally, several countries introduced laws regarding crypto regulation, allowing mainstream companies to utilize the crypto market. In the report made by CoinTelegraph using Coinmap’s information, blockchain-friendly companies are mostly based in the Czech Republic, USA, and Argentina. Swiss and several other countries are also making efforts regarding cryptocurrency adoption.
Issues That Prevent Massive Cryptocurrency Adoption
On the negative side, due to the Chinese government crackdown on the market, many of the businesses there lost contact with digital technology. In a similar manner, India forbade its banks to have any dealings with blockchain companies and transactions.
Apart from the regulation, scams are still ramparted in the industry, with 80% of 2017 ICOs verified as scams by Statis Group’s report. The exact value taken from investors, hindering cryptocurrency adoption, is unclear. However, it did make many regular businesses shy away from the blockchain industry, according to the findings.
Lastly, the most cited reason, according to Peter Zimmerman’s report, remains value volatility of blockchain industry. Cryptocurrencies, with price changes wide and frequent, frighten businesses that wish to utilize them as payment methods. Blockchain technology, although innovative, cannot supplement the lack of stability.
The Future Outlook
Combining findings, the blockchain industry has moved tremendously since 2009 but cryptocurrency adoption is another story. So far, the only a handful of businesses accepts payment denoted in digital coins. Even less use coins within their supply chains. The market itself, after the initial boom at the 2017’s end, experienced a large dip.
So far, even though ICOs produced a number of Ethereum-based blockchain networks, bitcoin still reigns as a top crypto solution. So far, most of the new efforts concentrate on blockchain solutions, rather than digital coin monetization. Governments still see cryptos as online assets, rather than currencies. As mentioned in the Reddit discussion, it seems that cryptocurrency adoption is still in the early adopters’ stage.