Decimal points may be the death of Bitcoin as far as widespread adoption is concerned.
We learned a good amount about Bitcoin and Bitcoin startups last night at the Refresh Miami monthly event, but beyond all the complicated lessons about wallets, cryptography, and blockchains, that will make the general consumer unable to understand how their money translates to Bitcoin and how to use it, one singular thing stood out in my mind, that could be the greatest stumbling block to adoption – decimal points.
One of the speakers (my apologies for not catching the name) was asked about the limits to the number of Bitcoins that can be made available being 21 million and if there is a limit on them, then how could they become a currency worldwide and used by all. The response was that Bitcoins can be broken down into 8 decimal points, so you can fractionally spend Bitcoins with one of the denominations being a MilliBit.
The name chosen by popular vote in poll on the Bitcoin forum to represent the SI unit of 0.001 bitcoins (BTCs). – Bitcoin Wiki
Sorry folks, but that isn’t going to cut it, at least in the good ole US of A, where we can’t even get people to switch to metrics or be able to convert it. Can you imagine trying to get people to understand calculating their current Bitcoin counts down to 8 decimal points? Without having a solid footing on how to make this as simple as denominations for the US Dollar, I am concerned that this will be a dismal failure. Of course there are ways around this, but we are just getting started with trying to get normal humans to understand how Bitcoin works and why it’s better. I’m not sure we can get them past this very simple sounding, but very complex to others issue.
I am all for this cryptocurrencies making it to the mainstream, but am definitely concerned about our ability to spread adoption.
The other very human factor issue, is that until there is drastic change in attitudes about these currencies, users will always have to calculate against their own currency every time they discuss buying something and that is a barrier to adoption. Certainly software can make that easier, but getting humans to think that way all the time is a very difficult obstacle to overcome. Now add these 2 significant usability issues to the complexity of what it is and how it works and I think we have very serious problems to deal with for this to be a success.
Don’t get me wrong, I am on the bandwagon and want to be a part of the mix and see success, but if someone doesn’t come up with a way around it, I think there is more promise in the underlying technology and platform to be used for other concepts, than full adoption of Bitcoin. Fred Wilson has more on that here.