In the fall of 2018, Money Button founder Ryan X. Charles famously called out the ‘onboarding problem’ of digital currency stating that it is quite difficult for one to obtain coins in case they want to participate in the economy.
In this article I will explain why I think onboarding is not a big issue, and why creating useful applications establishes the incentive structures to bypass this problem completely. Since Ryan made this video (before the BCH-BSV fork) purchasing BSV has somehow become more difficult in the nearly three years since then.
Coinbase refuses to list BSV and many digital currency exchanges delisted BSV while continuing to make it difficult to purchase it due to the continuous conveniently timed ‘attacks’ on the network. I believe that many BSV users believe that if (if, ever) Coinbase lists BSV, then that will solve the Onboarding problem.
The following tweet sums up how short-sighted that viewpoint is:
The question isn’t when BSV on Coinbase, it’s when Coinbase on BSV.
— 1jack (@liujackc) March 2, 2021
There is no need to depend on the legacy financial system to bootstrap something that deprecates it. Bitcoin at scale obliterates the need for the current credit card infrastructure, which Satoshi alludes to in the Introduction of the whitepaper. I wrote more about this here.
Several services have emerged that allow the purchase of BSV with a credit card and quite frankly they are all terrible. Furthermore, they did nothing to spur the adoption of BSV. This fact should be quite apparent as the network currently has the biggest blocks with the most transactions despite trading being disabled on the exchanges that do support it during that time!
With all these DeFi applications popping up on other chains and as ERC-20 tokens somehow these users obtain these tokens without the necessary onramps. These tokens gain enough adoption to justify that sought-after Coinbase listing in the end. Additionally, the fees on most other chains are absurdly high which does not seem to negatively impact the demand.
If the application has enough demand, the free market will solve the onboarding problem without the need for the legacy financial system to bail them out, even in the poorest communities:
In the above video, a community program formed named Axie University to allow people to bypass the high prices and fees to onboard to a game named Axie Infinity because of the vibrant ecosystem and opportunity to make money. Despite the higher fees (and prices), organic demand for goods and services prove to tear down the supposed walled onramps.
CryptoFights is still in beta, with caps on how far you can progress in the game and the maximum bet on a match being only ~$0.65. The demand for MetaCoin appears to have tapered off a bit as the price of the token has had a pullback, as uploading the same dog picture repeatedly is probably not sustainable activity.
BSV is just now getting started with these types of opportunities. Without the high fees and scalability issues, what type of demand will we see when comparable applications are built?
I look forward to those demand spikes occurring while Coinbase (and other exchanges) continue to refuse to list, and delist BSV.
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