The perennial question proffered by sceptics of digital currencies and distributed ledger technology, is ‘if blockchain is so revolutionary and digital assets are really the future of money, then why isn’t it mainstream?’
There are of course many reasons. Some digital assets have proven volatile, and unstable. There have been concerns about money laundering and worse; and in some cases, regulation is urgently needed.
When it comes to blockchain, the hurdles to mass adoption have been issues such as cost, speed and performance, and lack of education.
The good news is that these challenges are all being tackled. Although each jurisdiction moves at its own pace, overall regulation around digital currencies is becoming clearer and more robust. Furthermore, blockchain technology is improving and becoming more accessible every day.
So, where do we go from here? How do we take blockchain from the domain of specialists into people’s everyday lives?
The answer lies in taking digital assets and all the benefits of blockchain and integrating them into people’s existing routine.
And it is clear that there has been one application that has proved to be the key to mass adoption: the mobile phone.
Making The Case For Mobile Technology
As we look back over the past ten years, we can see that time and time again mobile technology has been instrumental to tech products gaining traction.
For example, it was only after Facebook integrated its services with operating systems, such as Apple’s iOS, and launched its ‘Facebook Lite’ version for low-broadband mobile users in emerging economies, that the company reached a tipping point. From catering to 65 million mobile users out of 305 million in 2009, Facebook’s user base now extends to a staggering 2.3 billion, with 96% of active users accessing its services via mobile devices.
Another great example is seen in relation to the rise of digital-first-banks. In July 2017, when Korea’s highly popular messaging app KakaoTalk launched its mobile-only Kakaobank, it attracted no less than 300,000 subscribers in the first 24 hours. Within two weeks, its user base surpassed 2 million. Now, just two years later, one in five Koreans, or close to 10 million, are customers.
While the digitalization of banks as a strategy to cut operational costs is nothing new, the remarkable success of Kakaobank is attributed to its ingenious leveraging of mobile technology as a way to seamlessly integrate a new service into people’s everyday lives.
Finally, and no testimony to the power of mobile technology is complete without it: the story of Tencent’s WeChat.
Officially launching in 2011 as a simple messaging app, by now, WeChat has grown into China’s most popular mobile app with over a billion monthly active users. It’s being used to chat, shop, read the news, play games, pay for meals, share thoughts, book a cab or even make a doctor’s appointment.
Perhaps most significantly, following the addition of payments to the platform in 2013, WeChat has played an important part in catapulting China from a cash-based economy, where credit and debit cards hardly gained traction, to a world-leading e-money economy. Now, it’s not just in restaurants, at wet markets or social gatherings that we can see China going cash-free. According to some Weibo testimonies, even the very poorest in society now use WeChat Pay and Alipay to collect handouts.
This brings us back to Facebook, which only recently announced its imminent launch of Libra, a blockchain-based digital coin backed by a basket of financial assets. If Facebook manages to get past the regulatory hurdles it now faces, and if it wins the trust of its users over mounting privacy concerns, we can expect Libra to have a massive impact on both local and global payment systems.
When thinking about Libra’s use case, as a form of money effortlessly sent across counters and borders, there is no question as to the role mobile phones will play. Mobile technology will be Libra’s key driver of adoption.
Looking Ahead: Mobile Technology And Blockchain
Indeed, with the ubiquity of mobile phones – particularly in emerging markets – it’s not hard to imagine that a digital currency like Libra could become the payment method of choice for communities in emerging economies. In fact, if digital currency exchanges such as AAX, Binance, Coinbase and others decide to include Libra as a form of payment or tradeable asset, Libra could even serve as a gateway for unbanked communities the world over to step into the global digital assets economy.
From being currently unable to access conventional marketplaces, the world’s 1.7 billion unbanked and others would suddenly be just a click away from partaking in global trade as they turn to digital assets to store value, grow wealth and directly participate in the valuation of the various blockchain projects out there.
The centrality of mobile technology is evident in digital currency exchanges like AAX. Offering spot trading, futures and OTC capabilities, the platform has been designed with a ‘mobile first’ mindset, because adoption happens on mobile devices faster than anywhere else.
For any technology to be picked up by the mainstream, mobile is going to be key.
Founded by Atom Group, a Hong Kong headquartered global fintech company, AAX is a digital asset exchange and the first to be powered by London Stock Exchange Group Technology. Providing a world-class venue for issuers and investors to meet and trade digital assets, AAX seeks to unlock blockchain’s economic potential in a secure, fully compliant, and high performance environment.
This article was first published for the Mobile World Congress 2019, in Shanghai.