Something cryptocurrency supporters don’t admit to enough — mostly to their own detriment — is just how user unfriendly most of their services are.
This is a major error. It’s this issue, along with price volatility, users’ exposure to scams and the system’s affiliation with the black market, that is really holding back mass adoption.
It becomes all the more apparent when you compare the usability of the average crypto service to mainstream alternatives like Venmo and PayPal (or even, for that matter, the good old NatWest app).
The technically minded will argue that us, the technically ignorant, are wrong about this. These services are actually intuitive and easy to use. Which, ironically, highlights the lack of self awareness.
A case in point was the recent propagation of a story about how Binance, a cryptocurrency exchange, only paid $124.60 in network fees to move $1.26bn of value.
This is great for Binance, but it doesn’t change the fact that money isn’t money unless it’s cheap to move it on a micro-transaction basis. And it’s on that side of things that everything remains conflicting.
On one hand, bitcoin data aggregators were showing that transaction fees were increasing — no doubt connected to the recent rally in bitcoin prices.
On the other hand, many of my most technically minded sources were telling me that these data points were misleading. Any transaction would get done for almost no fee and little-to-no wait time, it was just a question of manually overriding the default “recommended” fees set up on most wallet services.
But who really has the time and inclination to closely monitor fee transaction settings every time they use a service? Or, for that matter, to perpetually figure out if a nominal fee in satoshi terms is more cost effective than using a preset percentage fee?
On that basis, I decided to test things out by attempting to transfer my measely $19 of bitcoin (owned solely for journalistic testing purposes) from one wallet to another service.
The findings weren’t good.
First, it took over an hour to figure out how to gain access to the wallet — the service, it turns out, had migrated to an entirely new app since Alphaville last used it in 2017.
Second, even a standby team of bitcoin aficionados were unable to virtually guide me through the process of figuring out how to initiate a transaction without having to cough up a $5 or so default fee, which is what this particular service was demanding time and time again from me.
In the end, the system beat me. The transaction processed for a fee of 109773 satoshis, approximately $3.1 in dollar terms on the day, which our aficionado friends claimed was unreasonable and probably preventable had anyone other than a tech ignoramus attempted it.
While this is a fair comment, we would argue this reporter represents the rule rather than the exception in society meaning we’re not the first to have made this mistake.
Until the crypto geeks understand that, this technology is going nowhere quick in retail payments.
In other news, Forbes reported on Tuesday that Visa was entering the $125tn market for global money transfers (which, it should be noted, Visa is already very well established in) by launching a blockchain-enabled product called B2B Connect.
Without irony, Forbes then noted (our emphasis):
Unlike cryptocurrency-based blockchains including bitcoin and Ethereum, Visa’s product isn’t decentralised, since the payments giant has complete control over it.
Something the core finance community clearly doesn’t admit to enough — mostly to their own detriment — is just how user friendly their services already are and the degree they don’t need to be upgraded with systems that pretend to be decentralised when really they’re not, purely for the sake of PR traction with a public that doesn’t care either way.