Opinion – Ronaldo Lemos: The future belongs to wallets

Having a bank account can become something obsolete and boring in the near future. The main reason is that traditional bank accounts are capable of holding practically only one thing: cash. That’s why they tend to get more and more demodest. The future belongs to the so-called “wallets”, a term in English that means “wallet”.

The name is good. Think about everything you keep in your wallet (for those who still carry a wallet!): your ID, a ticket to a weekend concert, credit cards, business cards, and so on. This is the characteristic of digital wallets: they are capable of storing any type of asset. Both those that we carry today in our physical wallet and countless others that exist today in the present or may be created in the future.

In other words, a wallet can carry traditional money, it can carry cryptocurrencies of any nature, titles and securities, credit and debit notes, tickets, airline tickets, debentures, IDs, certificates, diplomas, NFTs, stablecoins of any currency, data personal and so on.

Another beauty of wallets is that it makes all these assets easily circulable as well. Can’t make it to the weekend show? Send the ticket digitally to a friend. Need to file a document or sign a contract? Use your identity and digital signature stored in your wallet and do everything from your cell phone without leaving home.

The last report of the “Global Payments Report” showed that wallets are also growing in Brazil. According to the report, mobile digital wallets already account for 8% of payments at physical points of sale and 16% of payments in e-commerce.

However, it is also necessary to qualify the characteristics of the wallets. Many people argue that for them to be truly innovative, it is important that they are decentralized and self-funded. In other words, depositing virtual assets into some institution’s account doesn’t change much. Custodying the assets yourself changes everything. In the first case, if the institution goes bankrupt, you lose everything. If they are being self-custoded in your wallet, you lose nothing (the assets, whether cash, tickets or cryptocurrencies, are under your full control).

Even the Linux Foundation created the important initiative called “Open Wallet Foundation”. Its goal is to create and maintain free, open, secure and free code so that anyone can create and manage their own digital wallet. This opens up a huge opportunity for banks and other institutions: they can also become custodians of the access credentials that people have on their decentralized digital wallets, taking care of their security.

When wallets grow, the commodity that will become most valuable will be trust. The emergence of trusted agents who protect wallet holders without necessarily guarding their assets will be promising. This model can become really revolutionary. Imagine, for example, that your personal data could be one of the assets in your wallet. You can manage them directly (and get paid cash for their use if you like). Perhaps 2023 will be a year when many people will download and experiment with the potential of wallets for the first time.

It’s over – store assets only in accounts maintained by an institution

Already – store assets yourself, but if you lose the access key to them, goodbye!

It’s coming – store assets yourself, but have the access key held by an institution