Ready P(l)ayer One: how we will pay tomorrow and what role crypto may play

Abstract

Payments cog the wheels of the financial system. Beyond the payment initiation process lies a largely invisible, complex, and systemically important network of payment systems, which involves central banks, commercial banks and other payment providers. From a contemporary perspective, existing user needs in the field of payments can in principle be met by today’s centralized systems. Blockchain and its payment assets can maybe offer the same service level but are not superior to the more traditional payment solutions out there. Fast forwarding to the future, one could imagine a scenario where the technology around blockchain and its payment assets matures further and changes to business and user needs, especially in the fields of Decentralized Finance, the Metaverse, or Web 3.0, demanding features for which traditional payment rails are not an obvious choice anymore.