The Bitcoin Tipping Point is coming and it will be the Big Bang of disruption in financial services, money and payments as we know them!
I often think about the “tipping-point” in Bitcoin’s journey to mass adoption and regularly as myself several questions. When will it be noticeable and what will trigger it? Has it already begun or if not, how far away are we? How do you define or measure “mass adoption” of Bitcoin?
A bitcoin meme of Morpheus and Neo posted online recently got me thinking again about how Bitcoin’s true exit most likely itself. Once a significant number of people begin to realize this idea, the tipping point may have arrived!
Even now, I can and regularly do pay for almost anything with bitcoin; if not directly, then with a convenient 3rd party concierge service such as Snapcard. Even still, in my opinion, Bitcoin isn’t even close to mass adoption considering the latest studies that estimate about 2 to 3 million people actually own or have owned bitcoins. The majority of those people own less than 1 bitcoin!
This reminds me of when I first learned about Twitter back in college. I would tweet then with maybe 5 followers and most of my friends would scoff at the idea as if there was no point and ignore me when I asked them to create a Twitter account. It was as if I was talking to myself. This was when Twitter had about 2 to 5 million users and when the media would make fun of the now ubiquitous word “tweet”. I can remember when there was a race to get 1 million followers and Ashton Kutcher was consistently in the news for being the first celebrity using Twitter as it starting grow like crazy. It’s called the Network Effect folks, and it’s going to happen to bitcoin soon!
Today, Twitter is a public company worth about $30 Billion and Ashton Kutcher‘s almost 16m followers was surpassed by Biebers 50 million and social media is embedded into the fabric of everyday life for more than a billion people worldwide. Still, many of my friends still don’t use Twitter! But, for those who have adopted the technology, they’ve become obsessed. Some can’t imagine what it was like without Twitter (or social networks) once they discover their value and utility. I think it’s safe to say Twitter already hit its tipping point but it’s still not as widely used as money could still not be considered in the stage of mass adoption.
Take a look that this chart provided by Bitcorati showing the standard adoption curve applied to Bitcoin- We’re still in the early adopter phase!
Furthermore, I thought it was also interesting to note that AOL still makes about $500 million a year from dial-up internet users. There are about 114 million households in America. That means roughly 2.2% of Americans still paying for dial-up internet service and some that still don’t even have internet service at all.
In other businesses that I’m involved in, I would say 1 out of 5 of my clients does not even have an e-mail address (usually the older demographics, 50+). Many would argue that the Internet as well as e-mail have reached mass adoption, but I disagree. As mentioned in Ryan Charleston’s talk in Miami, only 2.8 billion people have access to the internet… that’s less than 40% of the world population! This is changing quickly though. Just ask Mark Zuckerberg and Facebook about the drone company they bought! They plans to use this to bring wireless internet to billion people around the world! Perhaps Mark would agree with me in that the Internet has still not achieved “mass adoption”.
Recently, in a Wired article by Phil Ahad, I learned that 2,000 Americans surveyed about Bitcoin showed 42% of young respondents indicating they believe Bitcoin is a lasting currency. This strong support contrasts with the attitudes of Americans age 35+, with fewer than half (45%) actually knowing what a Bitcoin was and more than one in four (29%) believing Bitcoin to have no monetary value. Across all respondents, 62% of respondents believe Bitcoin is a scam, while 15% of male respondents believe Bitcoin is used to fund terrorism. Interestingly, 23% of respondents would be convinced of the legitimacy of Bitcoin if it could be used to buy a Big Mac, while the majority are waiting for the establishment of a formal exchange and/or a statement from the Federal Reserve. Keep in mind though, Bitcoin is a global currency and the above stats for Americans only.
Tony Gillapi, founder and CEO of BitPay also believes that many people in the near-future will use Bitcoin without even knowing, as it will operate behind the scenes facilitating the exchange of fiat currencies (or any asset) as a payment mechanism. I agree with Tony and see Bitcoin headed in this direction.
To conclude, I think that the tipping point has yet to come for Bitcoin but it’s moment is imminent; especially as the architecture, infrastructure and development evolves (Multisig integration, Crypto 2.0’s, blockchain proof of solvency, talent acquisitions at Bitcoin startups, Scrypt ASICS decimating 95% of the irrelevant alt-coins, ETF’s and Bitcoin funds, institutional level exchanges, etc). Bitcoin is a global phenomena and probably THE most disruptive technology ever assembled. So when people talk about mass adoption of Bitcoin, think about what that really means to you and how that’s really defined. Like the big bang before it exploded, Bitcoin is just a teaspoon of force right now. When the tipping point does occur, this will be like nothing we’ve ever seen!