Although the talk actually gave some years ago, much of the content is more relevant than ever.
The talk discusses why cryptocurrencies such as Bitcoin can become global currencies.
It also discusses some of the barriers it faces and also forecasts how and where the world will adopt cryptography in the future. Amazingly, Antonopoulos does not believe that it is the United States and Europe that first adopt cryptocurrencies as global currencies.
All this has to do with the four fundamental requirements for mass conversion to cryptography. According to Antonopoulos, the fundamental requirements are: relative utility, perceived security, technology and neutrality.
Why does cryptocurrency expert Andreas Antonopoulos believe that the areas where virtual currencies are most popular will not adopt them first? That’s where relative utility comes into play. This is because people in the “first world” already have financial institutions that work well.
Some people like the idea of using cryptocurrencies because they are not regulated by a government or a bank.
However, banks and governments work quite well in places like the United States and Europe. That is not the case in places like much of Africa.
“If you are living and breathing a structured first world, a rule of law, easily negotiable contractual obligations and resolutions through a justice system that sometimes works, but certainly better than most countries; a country where cross-border transactions are handled relatively efficiently, where you can move the currency and interact with the rest of the world…Bitcoin may not be as important to you,” said Antonopoulos.
“If you live less than a hundred miles from the border between Kenya and Tanzania, you make regular transactions in four currencies: the Kenyan currency, then the Tanzanian currency, the euro and the US dollar and you are used to carrying sacks of money, you are used to having floating exchange rates, governments take advantage of your currency and dilute it, so cryptocurrencies are a great option because your expectations are so different.”
The benefits of cryptocurrencies are greater in these countries with economic stability problems and, therefore, cryptocurrencies will be adopted as an investment more quickly.
Security has to do with the way some world governments monitor the currency.
“There are many places in the world where if you have a currency other than the national currency you are a smuggler, and there is no due process. So they shoot you for having Bitcoin,” says Antonopoulos.
Fortunately, there is something you can do about it no matter where in the world you are. You can support Bitcoin charities and help programs. Antonopoulos adds that “Investing in charities based on Bitcoin improves the concept of neutrality and makes it concrete.”
The third fundamental requirement is technology, which also constitutes an obstacle for much of the world. The places Antonopoulos says they would benefit most from encryption are those that rarely, if anything, have internet and electricity.
At this time, those things seem essential for encryption, although some services and applications have been addressing those concerns.
“We need Bitcoin to be usable without constant access to the blockchain. This is already possible in several ways.”
“Can we use Bitcoin in an environment without electricity, even without cell phones? If we can. […] A complete system of paper money can be built that is backed not by gold, not by floating exchange rates, but backed as proof of participation in Bitcoin which allows to exchange these pieces of paper at a premium of a value nominal,” says Antonopoulos.
That brings us to the fourth fundamental principle, neutrality. Most people will think about neutrality in terms of how governments control cryptocurrencies. However, Antonopoulos points out that neutrality can mean many things.
“Neutrality in Bitcoin means being able to adopt Bitcoin in any culture, in any language, in any religion, in any geography, but also in any political or economic system,” says Antonopoulos.
“Neutrality in Bitcoin means being able to address the rest of the world because, after all, it’s not about the ‘first world’, it’s about the other six billion people.”
Antonopoulos has provided the conditions for the global adoption of cryptocurrencies. He has explained the ways in which we can foster those conditions. His talk also gave a prediction of how it will occur.
“We assume that Bitcoin will gradually expand over time until it eventually overthrows several currencies and becomes the world currency. But that’s not how it will happen,” he says.
“Instead, what will be seen is a crisis, perhaps like that of Cyprus, and a massive conversion will be seen in a very limited geography.”
Mass adoption in one region will make it easier and more likely to occur in other regions. Of course, adoption will pose its own challenges.
“It is not about whether Bitcoin and other cryptocurrencies will be adopted, or where they will be adopted or when they will be adopted,” Antonopoulos concluded.
“The only question is whether we will be ready, as a global community for the influx of billions of people using Bitcoin and other relevant cryptocurrencies in new scenarios at completely different transactional rates.”