There’s a lot of talk revolving around Bitcoin’s transition from digital money to the store-of-value. The crypto market is dominated by speculators and money-making interests, which, up to now, has been the primary driver for many in our industry. But for those of us trying to build the future of finance, the focus has to shift from a store-of-value mindset to one thinking in terms of source-of-value.
BlockFi recently published a blog post with a simple thesis -- the future of the crypto industry rests with two kinds of projects: the ones focused on creating simple on-ramps into crypto and the ones providing more value than existing tools in the traditional financial world. People aren’t going to adopt something simply because it uses Blockchain. It has to be better. This idea, while broad, is the most significant roadblock for the growth of the crypto ecosystem.
Coinbase plays a significant role in our industry as not only a market leader, but the go-to exchange for first-time U.S.-based crypto investors. They were the first exchange on the market with a simple onboarding process that utilized a visual design consumers were familiar with. That simplicity provides value that feedbacks throughout the crypto industry. Once people buy their Bitcoin or Ether, they can move on to trade alt-coins, use D’apps, participate in ICOs, or even take out cryptoasset-backed loans. But-- they need to be on-boarded into the ecosystem first.
There's something to say for providing outstanding consumer value. Despite the high fees, Coinbase has been able to maintain their position as the most user-friendly exchange in the U.S. Why is that? Because their platform looks nice, it’s easy to use, and it works.
Drivers of value don’t necessarily have to be huge money-makers. Projects like CoinMarketCap, Etherscan, and DappRadar are on the pulse of the industry, providing essential information driving the life-blood of the ecosystem. They are the Wikipedia and Google Search of the crypto world and provide priceless value to everyone from traders to educators.
BlockFi’s driver of value is converting existing traditional financial products for crypto investors. Increasing the available liquidity in the crypto ecosystem in the form of debt and credit is especially important when considering the value this provides for individuals across the world. This means that we can connect low cost credit options and dollar denominated borrowing to emerging retail markets where it has never been available in the past. This has the effect of making crypto assets inherently more valuable and increases utility in the long term.
As we grow our business, BlockFi’s focus is on building simple solutions for complex issues. We are growing a network of like-minded projects to help make our ecosystem easier for consumers. The only way to fully take advantage of blockchain technologies is by transitioning our priorities from a store-of-value to source-of-value mindset.