Crypto fails as money and what needs to change

In December 2024, the price of Bitcoin (BTC) passed $100,000 for the first time. This surge, driven by optimism over a pro-crypto US administration, marked a historic moment. Yet, despite the excitement, it also highlighted an ongoing problem—cryptocurrencies still aren’t ready for everyday use.

Bitcoin and other cryptocurrencies have become popular as investments, similar to stocks or as some experts call it—Bitcoin is the ‘digital gold.’ But when it comes to being used as real money, they fall short. High fees, slow transactions, and often overcomplicated systems keep crypto from being practical for most people. If the industry wants to see mass adoption, it needs to fix these problems and focus on making crypto easy to use and accessible to everyone.

Old blockchain systems are holding crypto back

When Bitcoin launched, its decentralized design was groundbreaking. It showed the world a new way to secure and transfer money without relying on banks that are prone to external factors such as inflation and geopolitical constraints. Yet, over a decade later, its original system is struggling to keep up.

Bitcoin’s block creation process, which happens every 10 minutes, limits how many transactions it can handle. During busy times, fees go up, and transactions take longer to confirm. This makes using Bitcoin for small, everyday payments inconvenient and expensive.

L2 solutions like the Lightning Network try to make Bitcoin faster and cheaper, but such solutions still depend on the same slow base layer. This means the core problem remains unsolved. As a result, Bitcoin is mostly used as a store of value or an investment rather than as a way to pay for everyday commodities. For crypto to be widely adopted, it needs to move beyond this basic limitation.

Crypto needs to scale for everyday use

If cryptocurrencies are to work as money for everyone, they need to scale up in a big way. Today’s leading flagships like Bitcoin and Ethereum (ETH) can’t handle the volume of transactions that a global payment system requires. Congestion and high fees make them impractical for daily use.

Traditional payment systems like Visa and Mastercard, on the other hand, process millions of transactions every day with ease. For crypto to compete, it must match or exceed this level of performance. Small improvements aren’t enough. The industry needs bold new designs for blockchains that can handle massive transaction volumes without breaking a sweat.

Without this kind of scalability, crypto will stay stuck as a niche tool – good for speculation but not for replacing traditional financial systems.

The case for hybrid models and stablecoins

One way forward might be through hybrid systems that combine crypto’s strengths with the stability of fiat money. Stablecoins, which are tied to fiat currencies like the US dollar, already show promise. They provide the speed and privacy of crypto while avoiding the price swings of coins like Bitcoin.

Stablecoins are gaining traction in countries where local currencies are unstable, offering people a safe and practical way to store and transfer value. However, they’re only part of the solution. The industry needs a seamless system that integrates stablecoins, traditional cryptocurrencies, and even digital fiat currencies.

Such a system would give users the flexibility to choose what works best for them while keeping the key benefits of decentralization, speed, and security.

Changing how people see crypto

Another big hurdle to crypto adoption is how people view it. Bitcoin is often called ‘digital gold,’ which makes people think of it as an investment to hold onto rather than spend. While this idea has helped Bitcoin grow in value, it has also hurt its potential to be fully integrated into everyday transactions for lesser commodities.

For crypto to succeed as money, this perception needs to change. People should see it as a tool for everyday transactions, whether they’re buying coffee or sending money abroad. This requires not just better technology but also better communication and transparency from the industry. The message should be clear—crypto is simple, reliable, and ready to use in the real world.

The path ahead

We should, of course, consider that the industry keeps focusing on speculation and addressing crypto as a stock market while playing around with price gains, in that case, the industry and crypto will fail to reach their full potential and remain as a niche tool. But if the priorities were to shift into practical solutions, crypto could truly become the money of the future. 

The road ahead isn’t easy, but the goal is worth it. Crypto doesn’t just need new technology—it needs a new mindset. The question isn’t whether crypto can change the world. The question is whether we’re ready to make it happen.