06.17.2021 | Articles / Publications
Frank Springfield Featured in Bitcoin Panel Discussion on E-Crypto News
In an E-Crypto News panel discussion, What Are The Long-Term Prospects For Bitcoin? author Christopher Hamman brought together a panel of 13 business professionals, including Frank Springfield, to discuss Bitcoin’s long term prospects. The full panel discussion can be found here. Frank’s interview in full text is below.
“We have seen the amount of interest in cryptocurrencies skyrocket over the past year. Much like the current impact of the internet could not be predicted in 1995, nobody can reasonably predict the impact that cryptocurrencies will have on the financial system in twenty years.
However, I am confident that cryptocurrencies are not going anywhere and that their impact will be enormous. Whether it is utilizing this new technology to reach more of the unbanked or enhance their customer experience to providing customers with new products or custody options, traditional financial institutions are going to be forced to take a critical view of themselves and figure out who it is they want to be in the future to remain relevant.
There will be winners and losers, both large and small financial institutions, and my bet is that the winners will come from those who figure out how to embrace these changes, get out in front and carve out their niche. This will likely only be accelerated when the government finally decides to issue its own digital coin, which seems like a foregone conclusion at this point.
As the leader of the cryptocurrency discussion for the past year, people frequently ask if Bitcoin is a passing fad. It has carved out its niche as the best digital store of value and I expect it will continue to grow towards gold.
Whether, Bitcoin can grow beyond a store of value and develop more Level Two use cases remains to be seen. The main alternative use case for Bitcoin at the moment is its Lightning Network.
This network has expanded and offers fast and cheap payment rails for international transfers, but it still has a long way to go before gaining mainstream adoption.
Ethereum and even Hedera Hashgraph both have many more Level Two applications being built on top of them and may end up proving to be more useful platforms to financial institutions to use instead of Bitcoin.
It is well known that many Gen Z’ers have never stepped foot into a traditional bank and, likely, never will. Instead, many resort to “banking” through the use of CashApp and other apps they can get on their phone.
Aside from trying to figure out how to reach the next generation, traditional financial institutions are also facing increased pressure from institutions like BlockFi who are able to offer interest rates on crypto currencies that far exceed anything offered in traditional banking.
Therefore, I expect that more financial institutions will decide to get into the crypto game and perhaps the easiest way will be by offering to take custody of cryptocurrencies like The Bank of New York Mellon has done.
Some may also try to figure out how to increase their interest offerings, but this seems less likely given the regulatory concerns that likely allow these high rates to be paid. Others will explore how to use the blockchain/hashgraph technology and smart contracts to improve their product offerings, user experience and efficiencies.
Those who have credit card business segments will likely start offering cryptocurrency rewards cards if the growth of companies like Fold continue to increase.
In the end, it seems obvious that there will be many mergers and acquisitions between TradFi and DeFi. However, the longer TradFi entities wait to adapt to this new technology and the more runway given to DeFi entities to grow before they are acquired, the more difficult it will be for TradFi entities to control the narrative.”