Johnny Lyu is the CEO of KuCoin, one of the largest cryptocurrency exchanges launched in 2017.
I got into the internet business back in 1998 — a time when we still relied on dial-up modems. I watched the hardware evolve over time to SDN, ADSL and, eventually, to the gigabit network we know today. I also experienced the changes of the software ecosystem firsthand, from the earliest portal websites, to the YouTube boom, all the way to the mobile internet and the current TikTok era. In the 90s, people called the small group of internet users “netizens”. However, the term has become outdated since, as almost everyone is using the internet that has become the basic infrastructure of the world.
The co-founders of the KuCoin exchange and I dove headfirst into the nascent cryptocurrency sphere in 2012. At that time, the cryptocurrency industry was just emerging, and to most people, Bitcoin sounded like a crazy idea, made up by geeks for exchanging assets between each other. I remember when I bought my first Bitcoins, my friend said: Why do you need this? Gotta buy gold (in 2011—2012 gold was the most popular investment). Today, Bitcoin is worth 4,000 times more than in 2012, while gold has dropped in value.
The cryptocurrency prospects instilled us with enthusiasm and a sense of pride in being at the leading edge of a technology, which we believed would certainly become the technology of the future. We believed so partly because we noticed how similar the development of blockchain technology was with that of the early internet, and this time we had the opportunity to contribute to that development.
At its early stage of development, the crypto industry was driven by adventure-seekers who loved technology and innovation, much like the developers of the internet did in its early years. Despite the predominant skepticisms and confounding challenges, the crypto industry has continued to grow in both market size and user numbers over the years, giving me, personally, sufficient confidence to say that the underlying blockchain will become an essential infrastructure in the future, just as the internet has for the modern world.
Today, the internet allows us to satisfy our primary needs, as we no longer need to worry about food or clothing, or standing in lines to pay for utilities, and have instant connectivity with anyone around the world.
As the world evolves and the needs of digital infrastructure scaling expand, it is not at all impossible for us to one day witness the emergence of such systems as those seen in the film Ready Player One. Nevertheless, such a scenario will not be achievable in the near future, given that we are still facing numerous challenges in terms of technological perfection. If the internet is to be taken as an example, it is still incapable of storing or transferring value, though it has considerably accelerated the process of information sharing.
Nowadays, data or value is stored on the servers of companies and organizations, effectively belonging to them. Yet the second law of thermodynamics states that there is an end to all entities. This means that if your value is stored in a centralized organization online, it will suffer from a lack of transparency and security — an issue the internet cannot solve.
The advent of blockchain provides an answer to this problem on a global scale, as it allows us to store data or value on a basic infrastructure that can be shared universally without belonging to any individual, company or organization. In my opinion, this is the real value of the crypto industry and it will be effectively implemented on the basis of blockchain technologies within the Web 3.0 infrastructure of the internet of the future.
Looking back at the history of the internet, it won’t be hard to notice that a world-changing technology needs people to come in and develop and update the products all the time, so as to attract more and more users. In the same sense, the internet giants (i.e., Google and Facebook) are sending satellites and hot air balloons to space in order to provide network services at a lower cost. Even though some products are designed simply as a makeshift solution, they still can help people better understand and utilize the technology. Just like in the late 90s, the hottest application at that time was email, which, in people’s mind, was what the internet was all about.
The novel concepts and products emerging today, such as those provided by Decentralized Finance (DeFi) or Non-Fungible Tokens (NFT), might not be as popular anymore in the virtual world of the future, or metaverses. Yet we cannot deny their value at our time now, since they have helped us better understand the crypto technology and industry.
Still, for the crypto industry to achieve large-scale adoption, the products and services in it must be better tailored for the needs of the public at large. Big industry players such as crypto exchanges, regulators, software companies, can contribute to this process by making the decentralized world more accessible to more people.
To use the internet in its early days as an example again, one had to go through all kinds of troubles to get online, i.e., type URLs manually, since search engines were not available yet. It is only after the emergence of Google and smartphones like iPhone, that the internet has become easily accessible to the public. The lowering of the access threshold also spurs further development of the industry.
Back to crypto, the decentralized public chain or blockchain technology can be used to provide the underlying data support. Yet the basic—level public chain platforms cannot give rise to popular platforms like Google that serve the general public. Thus, tools have to be built on top of the data to meet the needs of more people. This is exactly the reason for which exchanges were created. Although a decade ago these exchanges — which could barely be defined as company or brand — had low transaction volume and no proven business model, they could provide simple tools for people to store and withdraw Bitcoins. Such a basic function was sufficient because it satisfied the needs of the users.
As more people enter the digital asset market, their demands will become more complex and individualized. And the new solutions of the crypto industry will be popular only if the needs of the user are met through the provision of demanded, convenient, and high-quality services.
These could include DeFi and NFTs, as well as cryptocurrency swaps, spot trading, options, futures, ETFs and many other financial products. A significant part of the responsibility for the popularization of cryptocurrencies rests with leading cryptocurrency exchanges, where people buy their first digital assets. In addition to providing cutting-edge financial products and working on streamlined onboarding, industry players have to keep social responsibility at the forefront, offering users tokens or services of new promising projects, any of which could become the next Google of the cryptocurrency world.
User-friendly products are synonymous with customer and community services that are wholesome and high quality, providing a high degree of user experience and satisfaction. Such adaptation to the needs of the users determines the future of the crypto industry, which requires all of its infrastructure constituents to remain steadfast and continuously improve their products and services.
Combined, such efforts could result in faster onboarding and accelerate the transition to the vaunted arrival of Web 3.0. Only the popularization of cryptocurrencies as useful instruments within familiar and adapted services along with ongoing user education efforts in parallel with integration will allow blockchain to become the future infrastructure of the ever-expanding digital environment.
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