Would you be willing to spend your cryptocurrency right now in the "real world"?
If you are like me the answer would probably be "no". Most people would be very hesitant to buy goods in the real world using cryptocurrencies and for a good reason.
Inflationary FIAT money is losing value every day while deflationary Bitcoin and most other cryptos are rapidly gaining value. That pizza you paid in Bitcoin might in time turn out to be a very expensive meal.
Having the choice to either pay for your meal in FIAT or crypto it only makes sense to get rid of some more FIAT money, thus holding tight to your precious Bitcoin etc.
The effects of this psychological/logical reasoning are undoubtedly having an effect on the adoption of cryptocurrencies and blockchain technology.
What would, in fact, be the effect on the market when nobody would willingly part with their crypto in the real world while all circulating (everyday) currency would be the less valuable FIAT money?
First of all, I fear that it would slow down the mass adoption of cryptocurrencies. When no one is willing to spend Bitcoin for goods no shops would implement it as a valid payment method. This would be bad for the prices of cryptocurrencies in the short term.
On the other hand. More and more people will discover the value properties of the crypto world and see it as the logical way of safe keeping their wealth. The members of the growing crypto community will continuously channel more and more money towards cryptocurrencies while covering most of their expenditures in FIAT money.
This will most likely increase the likelihood of a FIAT money collapse. This collapse will force the rest of the population towards the more valuable currency and we will finally see mass adoption.
We would, in essence, see two financial ecosystems, one losing its value while the other gaining value, until a major collapse would force the masses to adopt the only logical system.
There might already be many use cases for cryptocurrency, but that would not amount to much if no one is willing to part with their crypto assets.
This article gives a good historical perspective if you would like to read more on the subject
Would you actually choose to spend your cryptocurrency right now on real life products?