Who remembers VHS? What about Betamax? The point is that technologies come and go; some succeed and prosper, and some others disappear without trace. Some people are aware of cryptocurrencies but choose not to use them; for many of these people the problem is simply one of trust. It seems that a lot of people do not trust cryptocurrencies and the high-profile collapse of Mt gox certainly hasn’t helped things. A recent article on CNN about the future of cryptocurrencies reported that cryptocurrencies have an image problem and it is a huge one. That image problem is stopping Bitcoin, and other cryptocurrencies, from going mainstream. Hank Lucas, a professor at the University of Maryland, a man who studies and focuses on disruptive technologies has something to say about it:
“If someone came up with a virtual currency that people understood and who’s value did not fluctuate as much, well, then it might become the one adopted by the masses and not Bitcoin.”
Lucas went on to point out that there is certainly no shortage of alternative currencies but Bitcoin is still by far the most popular and widely used, but it’s hard to predict if Bitcoin’s popularity will last. One of the key factors in the growth of popularity in Bitcoin use has been the anonymity factor, another has been the fact that merchants do not have to pay transaction fees. However, most people are still skeptical about the currency. He went on to say:
“One of the biggest problems for bitcoins is people don’t understand how they are created and that’s not going to lead a lot of people to adopt it,”
The danger is that Bitcoin, or for that matter, any of the existing cryptocurrencies, might not emerge as the new dominant technology and a new, well marketed cryptocurrency may well become the market leader. A new cryptocurrency that markets itself on security and trust, one that spends some of their start-up money on advertising, may well come to dominate the market. Revisit please the battle that took place between Betamax and VHS in the video market; it is my opinion that the smaller Betamax tape was a technologically superior product that was simply defeated and dismissed to obsolescence. A more recent example of the benefit of marketing is the battle that took place between Napster and Apple’s iTunes. Why did iTunes appeal to consumers? One of the reasons was that Apple, a trusted company, told us all about it.
That is the problem with selling cryptocurrencies. People don’t trust them.
“I think its a big problem for consumers,” Lucas said. “If a bank fails you get your money back, or at least part of it, but when Mt. Gox failed, there was nothing there. … This has to discourage people who don’t understand a virtual currency.” He went on to say: “You never see an ad for bitcoin. You don’t see bitcoin pushing itself out there,” and “But if there was a digital currency that could market itself in a way consumers could understand, it could become the digital currency of choice.”
For people looking to promote Bitcoin, there is a company out there called Honeybadgerofmoney.com currently selling Bitcoin stickers. Ironically, they seem only to be accepting fiat money payments! Maybe I’m wrong, I’ve been wrong before, if I’m wrong again, please correct me.
So, why do we not promote cryptocurrencies outside of our own community? Do we hope to develop a successful cryptocoin and snap it up ourselves just before we tell the world and the market comes on board? If the next, great, shiny thing comes up from the blind side, we will be left holding a lot of digital codes and algorythms. Owning them will be like owning a lighthouse in a desert. We will have something brilliant but completely useless. Let’s be careful. There is, out there, somewhere, a warehouse full of Betamax video recorders.