Why Is Bitcoin Failing Its Original Mission as a Payment Method

• Bitcoin transaction lasts 10 minutes, on average
• The Bank for International Settlements released a report focusing on the economic functions of cryptocurrencies and DeFi
• $7.42 billion in crypto fines have been issued from 2013 to 2024

Since its 2009 inception, Bitcoin’s vision was clear: a decentralized digital currency for direct peer-to-peer payments, cutting out intermediaries. While Bitcoin has certainly gained global prominence, its journey has largely seen it embraced as a speculative asset rather than a widespread, everyday payment method.

Granted, you can pay for some (mostly online) services with Bitcoins, such as web hosting or VPNs. Yet, the truly mainstream purchase for everyday items remains largely out of reach for the average person. On average, Bitcoin transactions still take about 10 minutes on average to confirm, and that’s not something quite user-friendly. Not to mention that transaction fees can become prohibitively high during peak periods, making small or everyday transactions less feasible.

BIS Report Flags Crypto & DeFi Stability Risks

Research supports these usability challenges. The Bank for International Settlements (BIS) published a comprehensive report titled “Cryptocurrencies and Decentralised Finance: Functions and Financial Stability Implications” this month, delving into the economic functions of cryptocurrencies and DeFi. 

The paper highlights their potential risks to financial stability and proposes regulatory measures.​ It states that cryptocurrencies and DeFi, while aiming to mirror many services offered by traditional finance (TradFi) like lending, borrowing, and trading, actually introduce new financial stability risks thanks to their unique characteristics.​

For example, while smart contracts and decentralized exchanges (DEXs) offer efficiency gains, the report notes they also create challenges like information advantages for some users (asymmetries) and market inefficiencies. Stablecoins also have a notable role in DeFi, however, they can be a source of instability if not properly regulated.

In addition, the paper establishes that the adoption of cryptocurrencies in emerging markets can lead to a term called ‘cryptoisation’, where traditional financial systems are bypassed, potentially undermining monetary sovereignty and financial stability.

Regulatory Maze Hinders Mainstream Adoption

Arguably, the main issue with Bitcoin and cryptocurrencies in general is their regulation. Just look at the current SEC administration and the previous one – they are miles apart in what they think crypto regulations should be. For context, the prior SEC leadership oversaw $7.42 billion in crypto related fines from 2013 to 2024, while the current one seems much more lax, dropping 12 crypto cases from the start of this year.

Mind you, this is just in the USA. Countries all around the world have different types of regulations when it comes to crypto. As such, it’s a tricky road for a proper mainstream use by an average citizen. Nonetheless, Bitcoin is in a much better position than it was several years ago, as it’s getting more and more attention. So, as the technology advances, we might eventually see it being used in everyday transactions in the future.