Widespread cryptocurrency adoption can be segmented into three distinct categories: use cases, user experience, and regulation. Exceptional use cases, such as payments, possess a significant level of utility. To appeal to a larger audience and generate the necessary network effect, these use cases need a seamless and engaging user experience. A great user experience can open the door to a larger audience and facilitate scalability. Once a product or service has demonstrated its utility and provides a positive user experience, a sense of security becomes the final element of scalability. Achieving scale necessitates increasing users, transactions, and, most importantly, volume.
Regulation is critical in accommodating this volume, as volume is synonymous with institutional involvement. Onchain projects progressing along this trajectory are tapping into the massive potential that institutionalized value brings. The value proposition of these projects is further amplified by the fact that they will be ideally positioned to offer unique onchain products to mainstream users - products that aren't typically available offchain, if at all.
Consumer Crypto is Ready
These new offerings could expand or even complement the existing offerings in the industry. For instance, imagine your bank informing you one day that the product you've subscribed to used the surplus equity in your home to generate returns, thus enabling you to pay off your mortgage years ahead of schedule. Or, envision a service at your financial institution providing a platform to create credit from various assets you could deposit immediately. These are not far-fetched ideas; they are possibilities that are currently unattainable offchain but readily available onchain.
The potential of onchain projects to catalyze mainstream adoption of cryptocurrencies is immense. Companies like Altitude and Summer.fi are great examples of projects on this development arc. By offering unique products and services that are not available offchain, these projects enhance the utility of cryptocurrencies. Still, they are also opening up new avenues of financial freedom for users.
The industry is responsible for developing use cases and continually improving user experience, underlining its role in paving the way for broader acceptance of crypto. However, regulation requires a collaborative effort with regulators and is a serious task that needs to be undertaken with utmost consideration. Disregarding it altogether will lead to a dead end.
In this light, for these projects to truly unlock their potential and bring about a paradigm shift in the financial industry, they must balance these elements while continuing to innovate and adapt. The road will be bumpy, but the potential rewards are exponential (mass adoption!), making it worth pursuing.