Can we start calling blockchain mainstream yet? Not so fast.

Remember when every crypto article opined about blockchain becoming mainstream? Years later, as the likes of Elon Musk, Jack Dorsey, and legacy financial institutions enter the game, some have argued digital assets and the novel tech that powers them are, indeed, finally mainstream. 

They’re not. Unless someone comes from a dimension where El Salvador already is a financial superpower, there shouldn’t be much debate on the topic. For blockchains to become a day-to-day thing, progressive steps need to be taken within three strategic groups: governments, banks, and the blockchain industry. 

While the crypto industry’s current debate goes around “regulation vs. no-regulation,” the most relevant subject for governments and banks, there is much that needs to be decided within the blockchain industry, so everyone can move forward into a new age of finance. It’s like drivers are debating with the government on how to build roads, but they are ignoring what car manufacturers have to say.

Regulation alone isn’t the answer to an industry whose motto is liberty. Everyone knows telling someone to not do something that’s wrong isn’t usually effective. This obvious impasse between governments and banks around crypto exists because governments don’t have the means to enforce their regulations on blockchain in the financial sector, but they do have the power to make it illegal with the stroke of a pen. 

Governments need the means through which to regulate blockchain-based finance because banning crypto will only make countries that take a hardline on digital assets fall behind. If the blockchain industry wants to be truly legitimate, it has to build a solid bridge connecting itself to mainstream finance, instead of leaving the issue to governments and banks. Because also from a technical point of view, only a solution designed from the ground up with blockchain can provide the security needed to bridge crypto with traditional finance. 

Step one for crypto adoption: Hack-proof custody for whales and sardines

Blockchain’s first step toward becoming mainstream needs to start with the ability to safely own an asset, making digital wallets inviolable with institutional-level custody of assets.

Would you open a bank account at a bank that is famous for having clients’ cards cloned by hackers? Binance gets hacked so frequently that its owner is very upfront about “only having so much they can do,” meaning the ownership of wallets on many crypto exchanges is not as safe as a regular bank account.

We take it for granted when we check our banking apps and our money is there. That doesn’t mean it is impossible to have the money in your bank account stolen—but it’s not something consumers spend their days worrying about, because they feel safe enough to ignore this possibility.

Serious organisations, large or small, can handle risks but they have well-defined limits. Risking having financial assets disappear overnight from their accounts is clearly crossing the line and one of the reasons blockchain still isn’t mainstream. Traditional banking, and ordinary investors, will adopt blockchain when custody services are truly hack-proof, mirroring the state of security in traditional banking.

After adoption, crypto for the masses: Scale and anticipated usability

Although we are still not at the point where blockchain is being fully adopted by banks and financial institutions, recent adopters are already showing us the steps to be taken when adoption is a part of the past. Removing all cyber attack vectors can only be considered sustainable if it is also scalable, ensuring institutional and individual users have secure, high-frequency transactions every time they trade.

From 2013 to November 2021, the total of cryptocurrencies around the world jumped from 66 to 7,557, according to Statista. In order to bridge the gap between banks and blockchain developers, the financial sector must be able to onboard new cryptocurrencies seamlessly. Transactions need to be ready for automatic high-frequency transactions, equipped with a robust API and customer apps to enable enterprises to secure their digital assets with ease and accessibility. 

At some point, when these initiatives are adopted, we will see traditional assets being adapted to unprecedented blockchain formats that will allow new forms of financial engineering that are unimaginable today. As of now, these are the demands of many blockchain enthusiasts and the work of committed cybersecurity and crypto professionals.