Cryptocurrency Not Considered An Essential Payment System

Cryptocurrency Not Considered An Essential Payment System

January 2, 2019 Off Steven Anderson By Steven Anderson

A recent survey in China by a news site revealed that about 63% of the people thought that it was not essential to have cryptocurrency as a payment system.

About 40% of them stated they would be interested in investing in cryptocurrency.  About 14% of them reported that they have invested in cryptocurrency already. A news site did this survey.  Those who expressed interest in investing were born after 1990. Thus, younger millennials were interested in cryptocurrency.

When an analysis was made about the numbers of people who have heard of blockchain and cryptocurrencies, it was seen that about 98.22% of them knew about this technology and transaction process and only 75 people of those who were surveyed did not know about this technology. However, the vast majority of them had to state that they did not understand the technology so well.

This survey revealed that despite the ban there are several crypto exchanges that the Chinese make use of to access the crypto markets.  While there is a great firewall set by the government, this does not seem to stop China from accessing the cyber resources in the rest of the world.  While the access has been made difficult, it is not impossible.

The primary purpose of cryptocurrency as set by Nakamoto and in the Bitcoin white paper is to establish a peer-to-peer electronic payment system.

Payment has been the primary purpose of the cryptocurrency.  In a country like China, mobile payment is considered to be pretty convenient.  About 63.43% of the mobile payment options ignore encryption and assurance of privacy or confidentiality to its users.  Thus, the idea of promoting cryptocurrency using the tagline of “payment system” might not work.

The survey studied when the Chinese crypto investors came into the market. It was revealed that they entered the market when it was the bull period in the year 2017.  However, in the year 2018, there was an overall market decline, and all the investors who stepped into the market were suffering losses and are now left with just 1000 or 1500 yuan in the market.

With this being the fate of cryptocurrencies in China, institutional investors are stepping into the market in 2019. The year 2019 is expected to be filled with institutional dominance in the crypto world.

Whether institutions will be considering the Bitcoin as a store of value during hard times is something we are yet to witness. Though the price of Bitcoin might not in any way correlate with the value of the different commodities in the stock market, expectations and perceptions about the store of value offered by cryptocurrency are building up due to institutional investors.

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