Bitcoin Continues to Reign Supreme – But How Can It Accelerate Mass Adoption?

Guest Author blog November 19, 2019

Bitcoin Continues to Reign Supreme – But How Can It Accelerate Mass Adoption?

Bitcoin has been on a rollercoaster of a journey over its nearly 11 years in operation. The earliest adopters were the cypherpunks, with their vision of using this new digital currency to overthrow existing economic paradigms and usher in a new era of decentralization.

Once it started to gain traction, it became the currency of choice for the underground. Most famously as a means of exchange for dark web marketplace Silk Road. Ironically, it was the undoing of Ross Ulbricht, who apparently didn’t realize all Bitcoin transactions are traceable. The FBI didn’t make the same mistake, arresting Ulbricht in 2013 on charges of trafficking, hacking, and money laundering. Despite his incarceration, Bitcoin’s reputation became soiled as a currency for criminals and money launderers.

Many people don’t know that when Vitalik Buterin first conceived of Ethereum, he initially planned to develop it on the Bitcoin network. However, he decided to build a separate blockchain after some concerns that the underlying Bitcoin protocol could change in the  future.

In 2015, Buterin and his team launched Ethereum as the world’s first smart contract platform. Yet, even as smart contract fever took over, Bitcoin still reigned supreme. In 2017, it held its own through the controversial Bitcoin Cash hard fork.

Around the same time, the ICO bubble blew up. For the first time, altcoins appeared to put Bitcoin’s dominance in jeopardy, pulling it from over 85% in January 2017 to an all-time low of under 35% a year later.  However, the bubble soon burst, and throughout the crypto winter, Bitcoin managed to regain its former dominant position, back up to highs of over 70% during this year.

Throughout its eleven-year reign and at times, against all the odds, Bitcoin has managed to hold onto its status as the “king of the cryptos.” It’s evident that Bitcoin is the network of choice for the crypto community at large. It has the biggest ecosystem, the broadest community support and appeal, and is the most secure blockchain, commanding a majority of hash power.

So, When Mass Adoption?

Despite that Bitcoin has weathered extraordinarily well over the years, mass adoption is still some way off. Kaspersky’s 2019 cryptocurrency report shows that over 80% of people have never used cryptocurrency, and a third still believe that crypto is a fad.

Any marketing expert would argue that products need to grow and adapt to their audiences if they’re not getting results. But of course, Bitcoin doesn’t work like that. Give or take a few changes to the underlying code, it’s been almost the same since Satoshi mined the genesis block in 2009.

However, one feature of blockchains is that it’s possible to develop on top of them, and that’s where Bitcoin now has the potential to gain traction at a faster rate than it has in the past.

RSK – Accelerating Growth with Smart Contracts and RIF OS

RSK started in 2017 as a second layer smart contract platform developed on Bitcoin, bringing in smart contract functionality. Late last year, the company was acquired by IOV Labs, which has been developing the RSK Infrastructure Framework Open Standard (RIF OS). RIF OS is to RSK what Windows is to a PC.

Together, RSK and RIF OS enable developers to quickly and easily build decentralized applications accessible to users everywhere. The platforms offer a naming service for account creation, a state channel solution called Lumino for faster payments, and decentralized data storage.

Earlier this year, IOV Labs also acquired Taringa, a Latin American social network with over 30 million users. The plan is to develop a decentralized social media infrastructure, with apps powered by RSK. Taringa users are already somewhat familiar with cryptocurrencies due to a previous integration with the Xapo wallet. However, the new features on Taringa will showcase the potential of what Bitcoin can really achieve with RSK as a catalyst for adoption.

The RSK token, RBTC, is merge-mined together with Bitcoin. In October, the company announced it was increasing the mining rewards for RBTC by over a thousand percent. Even prior to that, RSK had already achieved 45% of Bitcoin’s hash rate. Increasing the rewards will no doubt cement its status as the most secure smart contract platform in the world.

Lightning Network – Enabling Lightspeed Payments and Lower Fees

Of course, RSK isn’t the only innovation to be developed on Bitcoin since its inception. One criticism of Bitcoin is that payments are too slow when compared to fiat payments using the Visa network, for example. Furthermore, when network traffic is high, transaction fees increase.

Therefore, the Lightning Network emerged as another example of how Bitcoin’s core functionality can be extended to help to enable mass adoption. Similar to RSK’s Lumino solution, the Lightning Network uses state channels to enable fast, low-cost payments.

Any two individuals can open an off-chain channel to send as many payments back-and-forth as they like. Once they agree to close the channel, the transactions are updated on-chain. The solution significantly reduces network load, while ensuring fast settlement without risking the high fees that may occur with on-chain payments.

Although Bitcoin has made massive strides over the years, it’s clear that it needs some kind of catalyst to bring mass adoption to a tipping point. Solutions like RSK and Lightning are able to broaden the appeal. By extending Bitcoin’s functionality, they’re putting it in front of new audiences, shining new light on what the network can do, and acting as the trigger for wide-scale acceptance.

 

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Bitcoin Continues to Reign Supreme - But How Can It Accelerate Mass Adoption?
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Bitcoin Continues to Reign Supreme - But How Can It Accelerate Mass Adoption?
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