Bitcoin First Questions—Why should I use Bitcoin?

When asked why Bitcoin has not become popular as an electronic online payment method, the common answer is - because Bitcoin is not yet convenient to use. Most people also agree that the use of digital currency is not that simple compared to other payment methods.

Bitcoin should become more user-friendly as a means of payment, and the industry should work to improve the basic functionality of major services, making it easier for everyday consumers to use and making default wallet functions more intuitive.

However, it is inaccurate to say that inconvenience is the biggest problem facing the Bitcoin industry, because if people don’t understand why they should use Bitcoin to pay, then there is no need to talk about the above issue.

At this point, I want to talk about a recent panel I attended hosted by Zapchain, a Bitcoin social network, which focused on “How to Brand Bitcoin in the Media.” My former colleague丹尼尔•考雷,本•帕尔Parr from Inc, and保罗•魏格纳from the Wall Street Journal and I discussed the gap between media interest in Bitcoin technology and consumer acceptance of Bitcoin payments.

When a user asked me how to make Bitcoin more accessible to someone who is not very tech-savvy, I quickly came up with a metaphor - Bitcoin faces a "Segway" problem (Segway is a motion-sensing vehicle invented by American inventor Dean Kamen).

It is important to note that the Segway was widely believed to be faster and more convenient than walking, and was heavily promoted in the media.

People in the Bitcoin industry should read an article published in Salon in 2001, which praised the innovation of Segway and mentioned that Apple founder史蒂夫•乔布斯also admired Segway. Segway enthusiasts praised it as a good tool for transportation.

But obviously, we don't live in a world full of electric scooters today, and even if consumers see the benefits of the Segway, many don't feel the urge to spend money on one.

Bitcoin is in a similar impasse.

At this point, the advantages of Bitcoin payment method are also understood by people, and Bitcoin has always boasted of "lower transaction fees, faster transaction speeds and protection of consumer privacy."

Marc Hochstein, editor-in-chief of American Banker magazine, also stressed this point in his opening remarks at last month’s Crypto + Blockchain conference, where he talked about how cryptocurrencies can protect consumer rights.

“I want to tell you that Bitcoin’s anonymity is not a bad thing to be worried about, but a good thing to be protected. I think the digital currency community is doing important research and development work to achieve a cashless future world.”

Clearly, people are aware of this, so I think the biggest challenge right now is getting those people who are aware of this to take action.

In other words, making people understand why they should use Bitcoin is like why you should use a Segway when you can just walk.

Ease of use

It’s true that new technologies face difficulties in entering the mainstream world. However, the Bitcoin industry has done a lot to make Bitcoin more accessible.

For example, the main Bitcoin purchasing services in the United States are already very user-friendly.

Bitcoin financial services startups such as Changetip, Coinbase and Circle already allow consumers to open an account and link a credit card or bank account to buy and send Bitcoin, making the entire transaction process very simple.

Ask yourself, how can we further improve these services? Of course I believe the industry can do this, but strengthening the services that have already been implemented should be more important. So the challenge now is why should I choose Bitcoin as my first choice for payment?

I recently hired a freelance artist to design a website for my friend. At first, the artist was skeptical about accepting Bitcoin and preferred to use PayPal. I convinced her to try Coinbase and told her I would help her with the payment process, but it turned out that was not necessary.

Because according to her, the registration and transaction process is very simple. It is even simpler than the check payment process because we don't need stamps, envelopes, pens, and we don't need to wait for several days.

Teach people how to pay with Bitcoin

To be honest, it’s not easy for consumers to buy this new form of digital currency. First they need a credit or debit card.

This is even more true outside the U.S. The industry often talks about expanding bitcoin access to the unbanked, but it seems unlikely to happen anytime soon, as these consumers currently require financial services to gain access to the system. (Abra and 21 appear to be trying to address this problem.)

The biggest obstacle may be that it is not easy to solve this problem in a business model. For example, the Internet can use advertising revenue to subsidize the cost of information dissemination. Although Bitcoin can be exempted from seigniorage, no similar solution has been found.

But regardless, Bitcoin works today and it is useful, it’s just not something we’re used to.

理查德•简达尔•布朗discussed this issue in a recent blog post, arguing that while Bitcoin, based on the blockchain network, cannot yet solve some banking problems, that doesn't mean it is useless.

“In terms of the problems people care about, Bitcoin is probably worse than existing solutions. But just for moving money, it’s very useful for some people.”

“Bitcoin can solve the money transfer problem faced by marginal users.”

Who are these marginal users? And how do they start using Bitcoin? The answers are less clear.

Indeed, some startups are starting to focus on the fact that the next wave of Bitcoin users will earn Bitcoin by teaching people how to use Bitcoin, but it is not clear who will pay for the costs of acquiring these new users.

In short, the Bitcoin industry needs to change its mindset and stop thinking about what should happen next while ignoring what is happening.