Bitcoin deserves to be the dominant world currency. Unfortunately, though, resistance to change delays the widespread acceptance that Bitcoin deserves. Without the obstacles created by this reluctance, Bitcoin would surely flourish more quickly and widely.
The disruptive nature of Bitcoin and the blockchain technology brings change — profound change. Indeed, these new technologies have put our civilization at the outset of a new, far-reaching technological revolution. Therefore, the resulting changes will be all-encompassing, pervasive, and irreversible. Most people are resistant to change, however; this is human nature. Many are risk-adverse and feel uncomfortable with such a profound change. They are reluctant to adopt new ideas and techniques. This resistance may hinder the rate of adoption necessary for Bitcoin to sustain healthy growth.
Given the attractiveness of Bitcoin, you would expect that more people would want to embrace it as their preferred currency. Notice that some of Bitcoin’s virtues include: decentralization, transparency, neutrality, fungibility (bitcoin units are capable of mutual substitution), some degree of anonymity, low transaction costs, no taxes, and security.
Moreover, Bitcoin is anti-inflationary. Bitcoin’s growth rate is scheduled, and the number of coins to be created is limited. In effect, it is expected that by the year 2140, the maximum number of bitcoins, 21 million, will be mined.
Granted, it is too early to expect wide adoption. It was only in 2009 when the Bitcoin network came into existence. Certainly, given the anonymous nature of Bitcoin, we cannot estimate the exact number of people who have adopted Bitcoin. We know the number of Bitcoin wallets. However, we also know that one user can have multiple Bitcoin wallets. Therefore, it is difficult to quantify how widespread Bitcoin really is.
Change is a Constant
But, what would be the one factor hindering Bitcoin’s rate of growth? The answer: resistance to change.
“The only thing that is constant is change,” said Heraclitus. Our ancestors lived it. This is not the first time that we experience the might of a new technology. Our ancestors went through it when they learned how to make fire and mastered agricultural techniques to produce food. Later on, they experienced the effects of the changes caused by the invention of the wheel, fiat currency, gunpowder, the printing press, the steam engine, the radio, and nuclear power. And, most recently, our generation has witnessed the profound changes provoked by the irruption of the Internet. Some of these technological changes brought joy and amazing opportunities for human development. On the other hand, they caused pain and destruction.
Remember, for example, the consequences of the 15th century Gutenberg printing press. This new technology, acting as an agent of change, facilitated the circulation of information and ideas. However, greater access to information weakened the control of those in power, triggering 200 years of horrible religious wars in Europe.
Today, people in organizations face constant change. This change is driven by forces in their external and internal environments. As a result, behavioral management and leadership theorists have developed several strategies aimed at minimizing resistance to change within organizations. Some of these change management strategies could be applied to decrease resistance to Bitcoin adoption.
The Top 8 Reasons
In this context, there are eight main reasons why people resist the adoption of Bitcoin:
- Unclear understanding. The need to change from using fiat currencies to a digital currency is unclear for most people. For most, the complexities of the cryptocurrency are too difficult to grasp. Bitcoin is as much of an enigma as is its creator, who remains unidentified. We only know his name, Satoshi Nakamoto. Also, for the mainstream user, it is not easy to obtain and exchange bitcoins. For example, only a few ATMs are operating and in very few selected locations.
- Fear of the unknown. “The oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown” (H. P.
Lovecraft). With the advent of Bitcoin and the blockchain technology, our civilization stands at the threshold of a new, far-reaching technological revolution. Its outcome is, as yet, unknown.
- Low trust. Bitcoin’s reputation has been greatly damaged due to events, accusations, or allegations abundantly circulated by the news media. Notably, the cases of the Silk Road, and the bankrupt Mt. Gox Bitcoin exchange, in which hundreds of bitcoins belonging to customers simply vanished. (Read Gox Bankruptcy for 22 Billion Dollars?).
- Loss of Security/Safety. The perception of Bitcoin’s capacity as a store of value has eroded due to its present value fluctuations. People fear for their financial security when considering making an investment in Bitcoin.
- Breaking routine. Mass Bitcoin acceptance necessarily involves a huge paradigm shift. After millennia of using currencies dominated and imposed by governments, people have ingrained routines for handling financial transactions. A decentralized cryptocurrency will drive people to new ways of executing financial transactions. It will introduce a whole new set of practices.
- Benefits and rewards. What’s in it for me? The answer to this quintessential question is not fully understood. Most merchants, for example, do not incentivize customers to make payments with bitcoins (by offering discounts, for instance).
- Poor communication. Basic information and the benefits that Bitcoin offer are not being adequately communicated. For example, mainstream media refers more often to the surrounding scandals than to the contributions that Bitcoin has already made to prosperity.
- A fad. Many fear that Bitcoin is no more than a short-lived craze.
Resistance will Break Down
In the meantime, it is essential that we improve communication and education. To achieve this end, every possible vehicle must be used. The good news is that this is already happening. Academia is joining the Bitcoin world; many universities in the U.S. and around the world are already teaching courses about Bitcoin. As a matter of fact, I myself am taking an excellent course entitled, Bitcoin and Cryptocurrency Technologies. This is a free, online course offered by Princeton University via Coursera. Additionally, hundreds of articles and books are being published daily. And, many conferences and meetups are being organized all over the world. Finally, and equally important, venture capital continues to flow into the Bitcoin ecosystem.
So, resistance to change is bound to break down eventually, and mainstream adoption will happen. Then, Bitcoin will take its rightful place as the dominant world currency.
Can you think of any other reasons why people might resist Bitcoin adoption? Let us know in the comments below!
Images courtesy of Imgur and Pixabay.
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