Evolution of Wallet: From textile to silicon PCB

Jun 06, 2024
3 mins read

The Evolution of Money and Wallets

In the beginning of early Civilization, there were no wallets to hold money in. Instead, the forms of money were either a big stone or a live animal. Only later on, the transition to smaller salable items started appearing that required storage. Some of the earliest wallets were used as sacs that held bales of wheat or pieces of pebbles.

As it became more complex to assess values, civilization started adopting better salable currencies, such as gold.

With the advent of money, first in the form of silver or gold, the necessity of the purse was born. Gold was heavy and required strong material for daily carrying, typically textile or leather. The quality of the leather indicated one's social standing and power. However, carrying coins also came with the risk of theft.

Transition to Modern Wallets

As gold was gradually captured by the nation-state and fiat currencies, especially paper ones, began to appear, the modern wallet was born. A typical modern wallet has space for fiat banknotes and sometimes coins. The introduction of debit and credit cards added a new dimension to wallets, driven by banks incentivizing deposits with lower reserve ratios to speculate with customer funds.

This item has been relevant for over a hundred years, controlling our life and spending ability. Without a wallet, purchasing anything anywhere becomes impossible. As time changes, wallets are evolving due to the convenience offered by bank cards.

The Minimalistic Modern Wallet

Modern wallets are now very minimalistic, often containing no paper money or coins, just a few cards. This trend started in the 2000s as the use of physical money declined. In some countries like Sweden, money is now almost entirely digital, making it difficult to obtain paper banknotes. This shift reduces the privacy of transactions due to increased digital surveillance.

This trend leads us towards a world with Central Bank Digital Currencies (CBDCs), where central banks issue money and have complete oversight over all transactions. This threatens privacy and could enable governments to restrict spending for any reason.

With Satoshi Nakamoto's release of Bitcoin in 2009, a revolutionary change began. Bitcoin introduced the concept of digital wallets, allowing users to control their money without third-party oversight. Hardware-based digital wallets enhance this control.

The Evolution of Hardware Wallets

Hardware wallets are still in their infancy but come in various forms and functions. While initially complex, newer models are becoming more user-friendly. These wallets are sleek, easy to carry, and password-protected. If a device is stolen, it can be restored with a secret phrase, making monetary theft more difficult.

We can speculate that this is not the final form of wallets. From textile to leather, and from leather to plastic, and now silicone-based circuitry, the next step might integrate wallets into the human entity, possibly controlled through our minds. This future could be utopian or dystopian, but as we move forward with Bitcoin, we head towards a more prosperous world.

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