The crypto space suffers from its checkered history and, to grow further, the ecosystem must become safer, more usable and more mature.
It has been said that you only get one chance to make a first impression. Perhaps the best example of this old adage is the crypto currency space.
From exit scams and money laundering, to unaudited code and high carbon footprints, the crypto landscape has spent the better part of the past decade scrubbing itself of its infamous past.
Today, however, the decentralized economy has grown into something much larger. Even in the face of market volatility, the culmination of decentralized finance, the nonfungible tokens craze, and the year-over-year increase in token prices have demanded the attention of these same investors who once shunned the decentralized economy.
Given last week’s dip, it’s natural to identify market stability as the most glaring problem within crypto. But, make no mistake, the primary (and most daunting) challenge facing the crypto space is security.
According to Cipher Trace’s crypto currency crime and anti-money laundering report, major crypto thefts, hacks and frauds totaled $1.9 billion in 2020 — the second-highest annual value recorded. The good news, however, is that this figure marks a drastic reduction from the $4.5 billion in fraudulent occurrences recorded in 2019.
Crypto currency has long suffered from a usability problem. With regard to financial investments, security and usability go hand-in-hand. Naturally, users feel more secure when the platform is easy to navigate and the functionality is up to par.
Perhaps ahead of schedule, the crypto currency space is creating significant waves among traditional investors. 2020 accelerated interest in crypto currency in unprecedented ways.
However, for institutional investors to take the cryptocurrency space seriously enough to invest, the ecosystem must become cleaner, more usable and more mature. The current iteration of the space suffers from its checkered history, and it is incumbent upon those within the crypto sphere to reshape its image.