The Key To Crypto’s Success Is In The Past


Courtesy of Mark Allinson via Google Images

Various types of cryptocurrency aim to change the future of exchange.

Yusuf Perwez, Staff Writer

Cryptocurrency is often considered by its supporters to be the currency of the future. A digital marketplace encoded by a revolutionary security system in the blockchain which offers users complete control over their money, with little government interference regarding its value or abundance. But cryptocurrency is also facing mounting challenges, namely its extreme volatility and the generally abstract nature of the technology behind it which makes it harder to accept for most people as a replacement for traditional currency. However, the idea of evolving currency beyond its current state has been around for centuries, and by examining the previous evolutionary steps of currency, both physical and digital, cryptocurrency might just find the key to surmounting its challenges and start to become a serious alternative for more people to contemporary currency. 

One of the key differentiating factors between cryptocurrencies and previous evolutions in currency is the purpose of the evolution. Previously, the currency has shifted in order to accommodate for increased practicality; bartering to coins to set value easier, coins to paper currency due to it being easier to move around, etc. Cryptocurrency is different because to some extent it does make it easier to carry around currency since it isn’t physical, its core appeal is more ideological than practical: the idea that governments and banks should have less direct control over people’s money and its value.

 In an interview about the topic with Mr. Raffetto, the Business teacher at Wilcox, he said, “I don’t think people feel really good about the control they have,” referring to banks. “Crypto would make it purer. If I wanted to transfer money to you, nobody could stop it.” So the battle which crypto aims to wage against modern currency must not only take place through convincing people of its practical merit but also through convincing people why decentralizing control over currency from the government would be beneficial for society. 

Crypto’s generally abstract nature is another important point against it which it must mitigate if it is to succeed. Crypto entails a much larger leap from the realm of physicality and understandability than most previous advancements in currency. In the world crypto aims to make where it’s the dominant method of exchange, it’s unlikely that there will be many forms of physical currency left. This abstractivity isn’t inherently a bad thing, but the harm it can cause becomes clear when looking back at crypto’s failed predecessors. 

One such example is Beenz, a digital currency that was given out to users who did things like visiting a website, shopping online, or other “internet good deeds.” The currency was shut down in August of 2001, and one of the largest contributing factors was many of Beenz’s partners and clients moving to the online payment options provided by Amazon and Visa through credit cards. The example illustrates that the public will ultimately choose the option that is most familiar and understandable. If crypto wants to counteract this, it will need to make itself more approachable, and one of the main steps in that process is to expand beyond the tight-knit community which has surrounded it. 

Cryptocurrency is often seen as an inevitable step that must be taken to advance currency or an ephemeral fad, but in reality, it’s simply another proposed evolution to our methods of exchange. Whether it’s to live or die is not based on its technological advancement, but instead on its ability to appeal to people as an efficient and necessary means of progressing systems of currency. In order to do so, crypto must look not just to the future, but also reflect on and examine the successful currencies of the past.