It is necessary to rethink the system of rewards and incentive structures of cryptocurrencies to encourage mass adoption. This was the theme for which Nicholas Merten, founder of the DataDash channel, drew attention to a recent tweet. The main incentive structures currently occur with the reward for mining blocks. However, this system may not be the most suitable for the mass adoption of cryptocurrencies.
Most crypto miners use rewards only for trading in exchanges. Hence, many of them become mere distributors of issued cryptocurrencies and not crypto-adopters themselves. Merten draws attention to the need for a profound change in this logic, benefiting those who wish to adopt technology in a deeper way.
With the change in the logic of reward for mining the fee paid on transactions also needs to decrease. Thus, the use of cryptocurrencies in everyday transactions may become more attractive to crypto enthusiasts. Commenting on the tweet itself, Merten mentions a cash-back system as a possible solution to the scenario.
A new scenario with the crypto economy
The cryptocurrencies have come to propose a major change in the world economy and may bring numerous improvements. They may be the solution to the traditional financial system, recently shaken by the subprime crisis in 2008. However, for this to occur it is necessary that the cryptocurrencies have a strong and consistent ecosystem.
