According to Coinbase’s CEO, using stablecoins could minimize the volatility of Bitcoin prices. There are research teams working on improving the stability of cryptocurrencies
Although cryptocurrencies are not being used in a massive way, its use has been increasing. In the same vein, there is also an increasing larger community that has decided to venture into the cryptographic industry, either for its benefits as a digital currency, as a way to overcome economic crises in their different countries, or simply to see in them an investment opportunity for the future.
The truth is that many experts say the industry has had a promising growth, but it is not yet ready for final adoption until certain principles of economic stability are met and practical tools for the management of these assets are created.
Bitcoin (BTC) is the first and best known among other cryptocurrencies, its use has been the main factor by which now this industry has been maintained, allowing its growth. However, due to its main virtue, which is being a digital currency, it has lacked reliability and financial security for many global economic markets. This has caused that the volatility is high and that cryptocurrencies’ prices have suffered important falls and increases, generating great fears in potential investors.
About this aspect, last Tuesday, April 2nd, Brian Armstrong, CEO of the most popular exchange company, Coinbase, answered a question posed by a user in an AMA session, “ask me anything” about the adoption of BTC in a massive way to which Armstrong explained that the future of Bitcoin will depend on how much is achieved to improve its scalability, its ease of use and, of course, minimizing its volatility in the market. This would cause greater confidence and stability, thus attracting a large number of investors.
For this to be possible in an acceptable period of time, Armstrong considers that the use of stablecoins is necessary in order to keep their prices stable within the market. He added that there are already several teams of experts and industries working on improving the stability of BTC.
Among these groups, it is highlighted the investigation of the digital micro-payments network Lightning Network, which is developing a system that will improve the speed of transactions with Bitcoin. Thanks to this solution, users can reach 500 transactions at 5000 per second, and compete directly with the Paypal and Visa figures.
In another sense, the financial analyst Andreas Antonopoulos is sure that the adoption of Bitcoin will be massive if more and better applications are developed to improve its ease of use. He ensures that the global financial market will be flooded if there is a large number of applications supported on platforms that help the transactions with digital currencies to work effectively. “What we are doing today is trying to simulate the existing system with fewer intermediaries and centralization, so that we can quickly exceed and start making applications that are absolutely impossible with the current centralized financial system”, he explained.
Antonopoulos, also said that the adoption of cryptocurrencies will not occur without any support, the job must be done to improve processes in an organized and quality manner, and that very few people use cryptocurrencies actively since many other people do not fully understand technology.
He concludes by setting a clear example of why he has increased the use of these assets as an emergency alternative and not as a concrete financial security option. “They are only being adopted in places where the pain of the current financial system is so extreme that people are forced to use something that is difficult to understand, difficult to secure, with very poorly designed applications and a very difficult wording”.
By María Victoria Rodríguez