Abandoned Adoption : Bitcoin Backslides and Hard Truths - #307

TL;DR - After three years of living on Bitcoin, adoption has regressed. Regulatory pressures, poor user experience, and declining merchant acceptance make daily Bitcoin use challenging.

Reader,

I started Living on Bitcoin to help spread adoption. The aim was to share my personal experience and insights, to make Bitcoin more human. The hope was to encourage more Bitcoin use in daily life. I failed.

Three years into this publication, adoption seems to have regressed.

Facing Reality

New tech takes time. The first iterations are clunky, and it takes many to perfect the user experience. But 15 years later, Bitcoin (BTC) has made little real-world progress since 2017. Regulations are draconian, public sentiment is skeptical, and second-layer solutions are problematic. Merchant adoption is lacking, and the user experience is abysmal.

"But we're still early," some say. I'd counter with, "We're a little late."

Yes, I've read The Block Size Wars and Highjacking Bitcoin. I've also read through the latest Satoshi emails and combed the Bitcoin Talk Forums. I'm speaking from personal experience. I do live on Bitcoin, after all. Theory, while important, is of little use to me in practice.

Abandoned Adoption

Merchants Lost

As planned, the Mrs. and I kick-started our nomadic life not long ago. We revisited places we enjoyed last year, expecting a similar ease of using Bitcoin. But this year, the landscape has shifted—for the worse.

The cafes and merchants we frequented had stopped accepting Bitcoin for three reasons:

1 - Lack of Transaction Volume: Not enough people are using Bitcoin to make it worthwhile. Why invest time and energy into something that has no demand?

2 - Regulatory Pressure: Governments worldwide are imposing more restrictions on how businesses can use Bitcoin. Compliance is time-consuming and expensive.

3 - Business Closures: Some businesses couldn't withstand the changing environment and shut down, partly due to reasons 1 and 2.

It's a shame.

But there are always prepaid cards and gift cards, right?

Prepaid Pains

Last year, using prepaid Visa and Mastercards made life simple. We sourced them from Bitrefill, The Bitcoin Company (The BTC Co), and others with little to no problems. This year, we faced much friction in the process.

The available amounts are lower. The BTC Co used to offer $1,000 prepaid Visa cards; now it's $750. Bitrefill offered up to 200 EUR; now it's 40 EUR. KYC verification is now required, making it tricky to pay at physical locations. Online purchases still work, but with restrictions on where you can use them.

Even with CoinGate and NOW Payments, online adoption is still low. This year, we've relied on Monezon.com and Bitgree.com for online purchases. It's a slower process, but we get what we need.

Gift Card Grievances

Gift cards have been a staple, but their utility is limited depending on where we are in the world. Unusable dust (small change) on the card is frustrating, and some processors are limiting or eliminating the use of multiple gift cards online.

Choking Point

Using prepaid and gift cards are good workarounds, but the companies selling them are at risk. If the regulatory trend continues, businesses will become even more limiting for users, potentially rendering these solutions ineffective.

Kill Your Coins/All Money Lost

Amid declining merchants, restrictive prepaids, and limited-choice gift cards, ATMs were an option. It worked for us last year. This year...

While out, we needed cash and used Coin ATM Radar to find the nearest ATM. We found over 70 Bitcoin ATMs. Fantastic! But most were "buy only" machines. Only two offered selling, one at a closed grocery store and the other at a phone shop 30 minutes away.

Relieved, we arrived at the phone shop. The ATM wanted my driver's license, passport, and a selfie. The cash limit was 500 EUR. This was not agreeable to me.

"That's standard now," the ATM/store owner said.

I asked if the new regulations had increased or decreased ATM use. He said less. I then asked if he would accept my Bitcoin in exchange for cash. He bluntly said "No."

I upped the offer. He refused. When I asked why, he said, "I don't want to deal with it." He explained he didn't use cash and didn't have any on him. He'd have to have the store buy the Bitcoin, which came with its own problems.

We walked away empty-handed.

Savings Sorrows

In another part of the world, we had dinner with a friend and his significant other. We chatted about how we got into Bitcoin, if we ever use it, and why adoption hadn't taken off. Their government’s "neutral" on Bitcoin. But in their system, everything works—there's no demand for Bitcoin. And no one, after 15 years, knows about Bitcoin still.

While he's into Bitcoin, his significant other isn't. He mentioned how he uses Bitcoin as a high-powered savings account and nothing more. With no adoption and regulations, saving is all he can do.

This conversation isn't unique. Even without the current regulatory climate, many people I speak to often say the same thing.

"No one accepts it," followed by "I use it for savings."

Realizing A New Strategy

We're going backwards. As time progresses and regulations grow, the situation for adoption worsens.

"In our attempts to shape the world to our liking, we may find that the world resists our efforts and becomes less malleable." - Alan Watts

Backwards Law

The idea, by Alan Watts, states that sometimes pursuing happiness can be counterproductive. You say you want to be happy, but in saying so, you realize you're unhappy. So you keep trying to do things that make you happy, but it reinforces the idea of your unhappiness.

The way out is to accept the present moment and let things happen in their natural way.

A Vicious Loop

In the case of Bitcoin, I can't help but feel that the more I push for adoption, the less adoption there is. Then we realize adoption is lacking, so we do more and end up with even less. It's a vicious circle stuck on an infinite loop.

The way out, from my current understanding, is to let go and let it all take its natural course.

Accepting GTZ

The basic premise of Get on Zero (GTZ) is to have zero fiat. Everything liquid is in Bitcoin. You try to use Bitcoin where you can. If you can't, you sell when you need and convert when you don’t. You can read more about it here.

Crypto Debit Card

You load your Bitcoin (or other cryptocurrency) to the card. At the point of sale, either online or in-store, you use the card. During the process, the card issuer locks in a rate, sells the asset, and covers the bill. Simple.

Each event is taxable, but it’ll give you a statement for taxes later.

Credit Cards

You use the card for everyday transactions throughout the month. You get the bill, settle the balance, and move on. Instead of many taxable events for the year, you get twelve. The accounting is much simpler.

Using a platform like Spritz.Finance, you can settle your debt and pay your bills using Bitcoin. Spritz also has a reloadable crypto debit card, which comes in handy.

Note:
And let’s be real honest too, most Bitcoiners with big bags, do exactly this.

Trade-offs

Let's be real clear: you are trading financial privacy for convenience.

In both scenarios, you need to go through the KYC and AML process, with no way around it. But in doing so, you’re not in constant begging mode. You do all the begging upfront.

Privacy is having the choice about which aspects of your life to reveal. There will never be perfect privacy, only good enough. In cryptocurrency, the goal is to have pretty good privacy and maintain control of your money.

A Smoother User Experience

No confirmation times. No timing up and down swings. No fee market bullshit. Better user interface on platforms. And customer service is available.

I hate saying it... but the user experience is superior.

We embrace the card method more these days. It’s made the Mrs.'s life smoother and worry-free too.

I barter and beg less often now.

Conclusion

Fifteen years later, only 6% of the world uses cryptocurrency. 0.2% have Bitcoin, and an even smaller percentage use it as intended. The rest use Bitcoin for savings and investment only.

The user experience is awful. The fee market concept is absurd. The clogged-up block space is ridiculous. There is no privacy on the base layer. Merchant adoption is lacking and dropping. Central Bank Digital Currencies (CBDC) are nearing launch. And if not a CBDC, then a private CBDC, like PayPal's stablecoin, will be commerce-ready.

According to the International Monetary Fund (IMF), the USD makes up 88% of world trade. The Brazil, Russia, India, China, and South Africa (BRICS), along with its 140 members, are ditching the USD. But even if they manage to drop the USD, another fiat will take its place.

Whether this was intended or not, whether Bitcoin was highjacked or not, is irrelevant to me. This is where we are right now.

Some would argue that Bitcoin will become the world reserve currency. There's a probability, but it would mean we have to change our understanding of the white paper’s terms—if the white paper is still important.

Regulatory pressures are making commerce difficult for both individuals and businesses.

Get on Zero is a balanced middle ground, but there’s a lot of work to be done.

Other cryptocurrencies focused on commerce are good. Commerce makes up 50% of what we do in life. It’s a big factor, and there must be an overall focus on making Bitcoin better than Visa and PayPal. Wallets need better interfaces, merchants need efficient POS systems, and more websites should accept cryptocurrency.

But without will, there won’t be a way.

In accepting the concept of Backwards Law, maybe the best way forward is to let it all go.

Those who started early enjoy their harvest. Newcomers will find their way.

For me, I am letting go and doing what works best.

It's all I can do. And this is all I can say... for now anyway.

Thanks for reading.

Rare Passenger / block height 847 338