Only 4% of the global population owns Bitcoin. Here’s what’s hampering mass adoption

Bitcoin’s increasing acceptance into the mainstream is a reality that can’t be denied. Despite the criticism that Bitcoin and the crypto industry at large continue to receive, interest in the asset seems to be growing all across the world, a trend driven largely by increased institutional participation and the many benefits and opportunities that this involvement unlocks. Nowadays, the general population has more venues than ever to gain access to Bitcoin, either via platforms that allow users to buy or sell coins directly, or by investing in alternative instruments such as BTC futures or the newly introduced spot BTC exchange-traded funds (ETFs).

However, none of these achievements matter if Bitcoin is not able to prove its worth. So far, the top cryptocurrency has been making steady progress, fueled by a combination of speculative hype, innovative design, and economic concerns that have pushed people into looking for alternatives to traditional finance. But all these factors and forces can only take Bitcoin so far. Even if the main crypto seems to be gaining more legitimacy and strengthening its position in the financial space, the only way for it to move forward and reach new milestones is to ensure it can provide something of value to people.

Basically, Bitcoin’s future and its integration into the global system hinge on how useful it becomes. If people can’t find a use for Bitcoin in their everyday lives, what point is there in accepting it? Since Bitcoin ownership remains very small, with only 4% of the world’s population holding the asset, the issue of its utility is rightfully put into question.

Bitcoin has been leading a bit of a double life, being created with one purpose and ending up serving another. When its mysterious inventors, known under the pseudonym Satoshi Nakamoto, presented their vision to the public via the project’s whitepaper, they made it very clear that Bitcoin was intended to function as a decentralized medium of exchange that could help people bypass the limitations and shortcomings of conventional finance. The very name of the paper, Bitcoin: A Peer-to-Peer Electronic Cash System, suggested this direction.

However, Bitcoin didn’t succeed as a payment mechanism, at least not yet. With no one at the helm controlling its development, Bitcoin took a life of its own and became much more popular as a store of value, promoting comparisons to precious metals and being often referred to as digital gold. With Bitcoin and most other digital currencies, the power lies with the community. Once a coin is released, no one can tell what might happen next.

In Bitcoin’s case, this dual role has led to an identity crisis that has yet to find a resolution. People can’t seem to make up their minds about what Bitcoin is and what it should be used for. And since there’s no organization or central body that can decide – a consequence of the asset’s decentralized nature – no one can provide a clear answer in this respect.

Bitcoin continues to hold aspirations as an asset that can be used to purchase products and services or an instrument that can act as a hedge against inflation. Unfortunately, none of these use cases is fully functional or available at a large scale.  

A theory that appears to be more or less satisfactory in explaining Bitcoin’s inability to expand its reach and serve more people is that the asset is still in its early stages of development. The original cryptocurrency is only 16 years old, which is remarkably brief for an invention created with the purpose of revolutionizing the world of finance, especially when considering its more conventional counterparts that have been around for decades or centuries.

As with all things that are new, intriguing, and complex, it takes a while for people to get accustomed to and accept it as part of their lives. The same thing happened with other innovations in the past. From electricity and automobiles to more modern inventions like personal computers and smartphones, all these creations faced resistance before the masses finally became aware of their utility and started embracing them.

So, the argument is that Bitcoin is simply ahead of its time and the world isn’t quite ready for what it proposes – and may not be for some time.

Ever since Bitcoin started to take off, people have been constantly talking about the huge potential it holds. Now, most are wondering when this potential is finally going to materialize. While it’s impossible to give a clear answer in this respect, given crypto’s volatile and unpredictable nature, there are a few things that could help the asset demonstrate its real-world applicability and thus facilitate widespread adoption.

The first thing would be ensuring that the general population has a good level of financial and technical literacy. This is crucial for people to be able to understand the concept that Bitcoin represents and how its real-world applicability can be of use to them. Having a solid grasp of Bitcoin’s fundamentals would lessen the confusion around its use cases and reduce the skepticism that people naturally feel when faced with intricate and foreign concepts.

Clearer and more comprehensive regulations would also make a huge difference to Bitcoin’s trajectory. The coin can only become a fully legitimate asset if it’s supported by a strong regulatory framework, something that governments are still struggling to develop.

Finally, Bitcoin would also require a robust and extensive infrastructure that would allow people to use it conveniently whenever and wherever they need it. This would speed up its integration into financial systems and foster broader adoption.