- Bitcoin is currently in the "slope of enlightenment" phase of the hype cycle, as its technology is becoming better understood after initial hype and disillusionment.
- Investment in Bitcoin companies has surged, with $226M invested in the first quarter of 2015 alone, which will fuel further innovation.
- Startups are addressing areas like payments, wallets, mining, financial services, exchanges to make Bitcoin more useful and easy to use for mainstream audiences.
2. A quick introduction: I host a technology radio show on 5FM, some podcasts, advise 22seven, and look after
product design at BitX.
BitX runs Bitcoin exchanges in South Africa, Malaysia and Kenya. We also have ofïŹces in Singapore, Indonesia
and the USA. Our Bitcoin wallet and storage services are available globally.
3. ?
Itâs interesting chatting to people whoâve just found out about Bitcoin. Iâm interested in the ïŹrst words that jump
into their mind when thinking about it. What are the words you think of?
4. volatile
A word I often hear when I speak to people trying to understand Bitcoin is âvolatilityâ. Thatâs because the price
of Bitcoin jumps up and down in relation to other currencies. You could ïŹip that around, however, and suggest
that currencies like the Dollar are volatile - their price against Bitcoin is all over the place =)
I believe Bitcoinâs âvolatilityâ will go away in not too long. Letâs not confuse Bitcoinâs short-term volatility with
itâs long-term awesomeness.
5. complicated
Another word I often hear when talking about Bitcoin is âcomplicatedâ. Thatâs because Bitcoin is new and, from a
technical perspective, is pretty advanced.
However, Bitcoin doesnât need to be complicated in terms of what it can do for you. Bitcoin is money for the
internet. You can buy stuff with it, send it to friends or receive it as payment. Simple.
The internet is also complicated in terms of how it works, but simple in terms of what you do with it. We need to
start talking about Bitcoin the same way.
6. decentralised
This is my favourite word associated with Bitcoin. It doesnât rely on a central authority. You can be your own
bank with Bitcoin. This decentralised nature is its most exciting quality.
7. I tend to see all problems as design problems, so when I think about Bitcoin changing the world, I try to imagine
its adoption as a design challenge. The technology is elegant, but the experience of using it is still clumsy for
most people. If Bitcoin is going mainstream, we have to design experiences of using it that are friendlier for non-
technical users.
We need to make Bitcoin as attractive on the outside as it is internally.
8. Diffusion of innovations
Itâs interesting to consider Bitcoin in terms of traditional product lifecycle management. Letâs think of Bitcoin as a
product and look at it through the lens of two product theories, beginning with the diffusion of innovations.
9. This is the âdiffusion of innovationsâ graph that tracks a product throughout its adoption.
10. Innovators
Adoption of any new technology begins with the innovators themselves. These are the people that created it
and are its de facto ïŹrst users. In the case of Bitcoin, this was the pseudonymous character of Satoshi
Nakamoto and the ïŹrst computer scientists that contributed to its development, including Mike Hearn and Gavin
Andresen.
If Justin Bieber was a product, this wouldâve been when he was ïŹrst discovered by the people who write his
music.
11. Innovators Early adopters
Next come the early-adopters. This is an exciting phase for any new product, because early adopters are
awesome. They give you heaps of feedback and donât mind putting up with the technical complexities of new
products. They will actually sacriïŹce their own time to make things work and think of themselves as co-creators
more than mere users.
The young teens that ïŹrst started listening to Justin Bieber were the early-adopters, key to his success in the
mainstream.
12. Innovators Early adopters Early majority
If a product survives the early adopter phase, it goes on to the early majority. This is when a product can ïŹrst
be considered âmainstreamâ. The cool kids are using it and telling their friends about it. People are posting
about it on Facebook and your mother has heard about it.
For Justin Bieber, this was when he got play on big radio stations and his fan base started looking more diverse
than just screaming teenagers.
13. Innovators Early adopters Early majority Late majority
The late majority stage is when mainstream adoption begins to hit saturation points. This is when âeveryoneâ is
using the product.
Like when your mother started listening to Justin Bieber.
14. Innovators Early adopters Early majority Late majority Laggards
Finally come the âlaggardsâ. This is where Justin Bieber is right now. Still killing it, but not opening up new
market segments. And probably about to disappear.
15. Innovators Early adopters Early majority Late majority Laggards
The curve of adoption in terms of market saturation looks like this orange line. It tips past 50% as a product
moves from early majority to late majority.
16. Innovators Early adopters Early majority Late majority Laggards
âThechasmâ
In-between early adopters and the early majority market, however, looms âThe Chasmâ. This was a term coined
by author Geoffrey A. Moore who identiïŹed the chasm as the most challenging period for any innovation as it
moves between two fundamentally different markets. Many products die because they canât âcross the chasmâ
and make the necessary changes to appeal to mainstream customers.
17. Innovators Early adopters Early majority Late majority Laggards
âThechasmâ
Thatâs where Bitcoin is headed in the short-term. Itâs still being used and loved by early-adopters, but it must
cross the chasm and become more appealing and less confusing to everyone else if itâs going to make the leap
into the mainstream.
19. State of Bitcoin Q1 2015
The guys over at CoinDesk recently put out their latest report on the Bitcoin status quo. It gives us a great
overview of the Bitcoin landscape and Iâd like to pick out a few points in terms of discussing Bitcoinâs leap into
the mainstream.
20. Q1 2015: The biggest yet for Bitcoin investment
US$226m, of a projected US$676m for the year
CoinDesk - State of Bitcoin Q1 2015
Firstly, CoinDesk points out that the ïŹrst quarter of 2015 was massive for investment in Bitcoin companies.
21. âImproved regulatory clarity ⊠building conïŹdence and attracting Wall Street.â
CoinDesk - State of Bitcoin Q1 2015
24. âFactoring in remittance fees makes Sub-Saharan Africa the most fertile market for Bitcoin ⊠â
CoinDesk - State of Bitcoin Q1 2015
Africa remains of particular interest for mainstream adoption of Bitcoin, along with South-East Asia and other
developing markets that tend to leapfrog the âïŹrst worldâ in terms of innovation.
25. Good design will also be key. Of course =)
CoinDesk - State of Bitcoin Q1 2015
26. The Hype Cycle
Another interesting theory is Gartnerâs âHype Cycleâ that looks at the visibility of new technologies and products
over timeâŠ
Time
Visibility
27. Technology
Trigger
Peak of
Inflated
Expectations
Trough of
Disillusionment
Slope of
Enlightenment
Plateau of Productivity
These are the different phases of the Hype Cycle, as described by Gartner. Theyâre pretty self-explanatory and
itâs fun to think of our favourite products in terms of where they are in the cycle now. Smartphones, for example,
are on the âplateau of productivityâ. They are well understood and make a meaningful contribution to society.
28. Technology
Trigger
Peak of
Inflated
Expectations
Trough of
Disillusionment
Slope of
Enlightenment
Plateau of Productivity
Bitcoin is over here, from my perspective. It has moved through the cycle relatively quickly, compared to other
new technologies, and is now approaching the slope of enlightenment, although there is still a lot of
disillusionment related to perceptions in the market.
30. ?
So with massive investment, smart startups working to make it more appealing, and a growing base of
mainstream users, the future looks bright for Bitcoin as it approaches the âslope of enlightenmentâ. But where is
it going in the immediate future?
31. In a word? Everywhere. Regulation is needed for Bitcoin to really change the world of money, but weâre
conïŹdent that this will come soon. Increasingly, however, people are just going ahead and using Bitcoin
because of the massive opportunities it holds. Itâs the quickest and easiest way to start receiving money from
online customers, for example.
32. Mobile will also be key to taking Bitcoin mainstream. I think of the smartphone like Pacman, chomping up all the
other things in its environment. It consumed your bedside alarm-clock, your walkman, your GPS and your
notebook. Itâll soon replace your wallet too, and products like Apple Pay have helped educate the market about
how awesome mobile money can be.
Bitcoin is the best kind of money weâve ever had. It and your phone are a match made in heaven =)