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What Are The Challenges To Blockchain Adoption In Payments? 9 Experts Share Their Insights

  • 24 September 2019
  • Sam Mire

Blockchain technology isn't still widely understood, a fact that’s been a hindrance to its broad adoption. Yet there are other challenges to blockchain adoption in the payments industry, and these industry insiders shared their thoughts on those challenges. Here’s what they said:


1. Alexi Lane, CEO of Everex

Alexi Lane“Innovators and developers are not talking with decision-makers and regulators in the same language. There is a huge gap in understanding of the core technology and opportunities it provides between the involved parties. Many countries talk about fintech innovation, but when presented with opportunities, sometimes red tape it or present frameworks which won’t make particular innovation scalable. The lack of regulations and the requirements to obtain certain licenses for the untested products that may or may not work don’t help either. Setting up blockchain tech-oriented sandbox environments in different markets may fix this problem though.”


2. Giorgos Kourtellos, Chief Blockchain Architect of PumaPay

“With every emerging technology, it passes through the hype stage and people question whether blockchain technology will withstand the test of time. With more banks and fintech companies jumping on the blockchain bandwagon, it has a promising future. Regulators around the globe have been working on how best to handle blockchain networks and the cryptocurrencies the technology enables. As more investors and individuals invest in cryptocurrencies, the more is becoming necessary to establish a consistent and all-embracing regulatory framework for everyone. Regulation will play an important role in shaping how blockchain will evolve.”


3. Monica Eaton-Cardone, Co-founder and COO of Chargebacks911

Monica Eaton-Cardone“The real challenge facing blockchain payments is institutional faith in the technology. While there’s a lot of curiosity regarding what blockchain may offer, no one wants to be among the first to take on the risk of such a major technological change. We did see more interest once JP Morgan finally broke the ice with the introduction of their JPM Coin. That said, skepticism of the blockchain payments concept remains difficult to shake.”


4. Nimrod Lehavi, Co-founder and CEO of Simplex

Nimrod LehaviRegulation, by far. The lack of understanding, hence the lack of proper regulation with regards to cryptocurrencies. AML risks are usually paralyzing to most of the traditional institutions when it comes to crypto related transactions.”

 


5. Dr. Lucas Lu, Co-founder of The CyberMiles Foundation

“The original Bitcoin whitepaper was titled “a peer-to-peer electronic cash system.” 10 years later, Bitcoin now is primarily a store of value — i.e. digital gold. It is out of reach of most of the world’s poor and has not succeeded as a payment system. However, newer developments (such as Facebook's Libra coin) have led to a burgeoning “arms race” to become the electronic cash of tomorrow. Regardless of who—or rather what—wins out, can the poor and unbanked be helped to integrate into the world’s financial system? That will be the key measure of success.”


6. Todd Cameron, Product Owner at Vertex, Inc

Todd Cameron“Getting more people comfortable with the concept of blockchain payments is an ongoing challenge. Because it’s relatively new and not widely proven, people are having trouble trusting a system designed to be a trust protocol. When introducing blockchain, a lot of people’s minds shift to the worst criminal connotations of this tech, associating it with illicit activities like Silk Road, the Mount Gox exchange heist, and the Wanna Cry ransomware virus that required victims to pay in bitcoin. That’s not the way we want people to adopt a new technology. Reluctant adopters also focus on the volatility of cryptocurrencies, seeing massive fluctuations in the value of bitcoin and ether and the outright demise of dozens of other cryptocurrencies. Many people don’t understand that while bitcoin is the first widely adopted use case of blockchain, blockchain does not equal bitcoin. While we’re seeing more adoption every day, there’s still a sense of uncertainty, often due to a lack of understanding of the tech. To combat this, many of the greatest blockchain advocates have had to also become blockchain educators.”


7. Brendan Miller, Head of Product Marketing at Rapyd

Brendan Miller“Payments have always been local and will continue to be local. This local fragmentation creates complexity for blockchain initiatives. The biggest adoption challenge is not adoption of technology, but rather cooperation amongst sovereign governments and regulators to create consortiums that can actually work together. To maintain their sovereignty governments are incentivized to regulate and control their payments systems. Creating a distributed ledger system that can account for all this fragmentation is the bigger challenge.”


8. Sidharth Sogani, Founder and CEO of CREBACO Global Inc

Sidharth Sogani“Cryptocurrency! It is the number one challenge. The Idea of blockchain was to solve the Byzentines general problem in the Bitcoin settlements. That’s how blockchain was born. Blockchain is just a part of cryptocurrency as it’s a mix of P2P, encryption and blockchain. Because of cryptocurrency we get a decentralised open source and more trusted network as it works on POW or POS. Cryptocurrency must be regulated better to make the best for blockchain payments.”


9. Yana Afanasieva, Founder of Competitive Compliance

Yana Afanasieva“Resistance of the traditional banking system to integrate with blockchain payments providers.”

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About Sam Mire

Sam is a Market Research Analyst at Disruptor Daily. He's a trained journalist with experience in the field of disruptive technology. He’s versed in the impact that blockchain technology is having on industries of today, from healthcare to cannabis. He’s written extensively on the individuals and companies shaping the future of tech, working directly with many of them to advance their vision. Sam is known for writing work that brings value to industry professionals and the generally curious – as well as an occasional smile to the face.

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