Bullet Wealth’s Scott Marek gave me the chance to project what a digital ecosystem will do to the idea of wealth. I am saying that when you digitise a deposit account, it ceases to function as a store of value and becomes a token for transient transactions, as happened in Silicon Valley Bank. Ditto a digitised mortgage account will enable the mortgage owner to flip his asset at will, instead of waiting months for the paperwork to be completed.
We also discussed the banking industry’s slow and clumsy adoption of blockchain and the necessity for open APIs for long-term relevance. Here are other key lessons from our conversation:
● Previous banking approaches that centralised these processes have been disrupted by individuals’ increased control over their data and relationships.
● Digital wallets transform traditional bank accounts that pay interest in functional accounts to help navigate the internet.
● I believe banks will become stablecoin issuers as regulators encourage them to tokenise their deposit base.
The digitising of banking creates the unintended consequence of making the traditional bank customer become increasingly familiar with cryptocurrencies and decentralised finance. Instead of weaning users away from cryptocurrencies, regulators will lead them right into this space.
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