What's in your wallet?

Attack of the killer wallets

I bought a new wallet the other day, on Amazon, after looking fruitlessly in store after store for what I wanted. I’m happy with my purchase; it’s got an outside sleeve for my transit card, a clear window for my ID and even a money clip instead of an interior billfold pocket. I have no idea who made it.

The thing is, I don’t really need my wallet most of the time. I haven’t in years. The Starbucks app lets me get caffeinated after a walk on the beach. Apple Pay takes care of a trip to the grocery store, and Apple’s Wallet also stores a virtual version of my Clipper card for the bus now. Soon our IDs will be digital, too. Cash? Eh, I’ll just Venmo you.

Everyone wants to be a wallet. The wallet metaphor is powerful: a store of both identity and value. Who in tech wouldn’t want a lock on that?

• The notion of an online tool that stores a credit card for use goes back decades. (I like to say things like that, for I am old.) PayPal still leads the category, particularly in traditional ecommerce.
• Apple Pay and Google Pay are popular as far as mobile wallets go, though they still don’t get much use compared to physical cards.
• There’s also Amazon Pay and even Meta Pay, though the wallet formerly known as Facebook Pay is mostly useful for Instagram and Facebook marketplaces and Shopify. Shopify has its own Shop Pay wallet. Even Walmart and Safeway have wallets in their apps. Confused yet?

Crypto has complicated things further. Sending or receiving crypto requires a wallet, though a crypto wallet is really just an address on a distributed ledger. Yet the crypto and NFT crazes gave the wallet metaphor even more power.

• Robinhood revved up users by promising a crypto wallet, though its timing was poor, as interest in trading crypto tumbled along with the price of bitcoin this year.
• Want to buy an NFT? You need a wallet, preferably MetaMask, which OpenSea more or less recommends.
• The weird thing about crypto wallets, though, is that they’re public and transparent: Anyone can see the transactions. And anyone can send things to them, which means celebrities get spammed with shitcoins and junky NFTs. A crypto wallet is less like a wallet in your pocket or purse, more like a mailbox on the side of the road that any nosy neighbor can peer into or stuff with flyers.
• Here’s a sign that the wallet trend might be jumping the shark: Adam Neumann’s Flow, which just raised $350 million from the crypto enthusiasts at Andreessen Horowitz, is reportedly developing a wallet for tenants of its residential real estate properties. It won’t be used for making rental payments with crypto — that would be too useful — but it could be used for “tokenized” rewards, a company spokesperson told Forbes.

How many wallets are too many? In the real world, we typically have just one. And that’s where the metaphor really fails.

• Randi Zuckerberg, who has found a new phase in her career promoting crypto, says the problem is, well, short-sighted corporate greed. A surfeit of wallets is “not contributing to development” of Web3, she said at a talk at the Global Supertrends conference Wednesday. “You leave the house with one wallet,” she pointed out. “And you need to see that same behavior online also.”
• Maybe she could have a chat with her younger brother about this? In announcing that Facebook Pay was becoming Meta Pay, Mark Zuckerberg promised “a digital wallet for the metaverse,” but admitted it was “a long way to get there.” And it’s far from clear that Meta’s competitors, or even its users, want Meta to be that one digital wallet. Regulators might have thoughts here, too.

If we’re really going to work this wallet metaphor, maybe the best wallet is the one you don’t have to think about. Apple and Google might have an edge here, since their built-in wallets increasingly blend into the everyday functions of iPhones and Androids. But they’re still much harder to use than the physical tool they aim to replace. When I got my new physical wallet, I just moved my cards over, which was a lot less painful than restoring my multiple digital wallets when my phone died.

And that’s the contradiction at the heart of this trend: A truly interoperable wallet is maximally useful for consumers, but a valueless commodity to the company providing it. If a tech company isn’t trying to pick it, is it really a wallet?

— Owen Thomas (email | twitter)

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