It seems at first to be a simple enough question: what is money?

A Google search or two later, and you will have a multitude of not-so-simple answers. It won't be long before you are contemplating Cowrie shells, Rai stones and the evolution of the banknote. You'll encounter various interpretations of history, enter into semantics of money versus currency, the gold standard and commodity money.

However, we can get to a working definition if we start from understanding 'modern money'. By 'modern money' I mean the money that we all typically know and use — government-issued currency.

Our understanding of money typically forms more by a slow hypnosis from childhood than by way of structured learning. Unpicking that puzzle in our minds is a huge challenge, requiring the shedding of deeply held beliefs.

"I sometimes get the feeling that if you look into the concept of money with too much scrutiny, it will simply disintegrate. Money is a bit like language: you are born in a given system, you grow up using it but you seldom have any incentive to speculate on its essence." — Brett Scott, Cloud-Money

War on Cash

Recently, there has been much debate about a global 'War on Cash'. Cash has been marketed as 'outdated', a hygiene risk, and used for terrorist financing. The Covid saga expedited this story significantly.

But this is a very one-sided view. Cash protects privacy and is resilient in the face of natural disasters or banking failures. The lack of privacy that comes with digital money leads to a better environment for automated financial controls — billions of people becoming further locked into surveillance, their data extracted and exploited.

Cash is a weapon against this.

Money and Blockchain — A Useful Comparison

In the blockchain world, there is the concept of 'Layers' of settlement. Layer 1 blockchains like Ethereum are expensive and offer premium security. Layer 2s periodically settle on the L1s. The banking world is not dissimilar — central banks, commercial banks, then payment processors like Visa and Mastercard.

Cash enables peer-to-peer transactions with optional privacy — something increasingly difficult to achieve in the digital world.

Closing Thoughts

If you take away nothing more from this piece than the thought that perhaps, just maybe, cash is worth saving, then it was time well spent. Cash is the only real government money we have access to, offers unique privacy features, and provides a critical backup in the face of natural disasters, bank runs and cyber attacks.

TLDR: The current systems for conducting commerce online have their limitations. They have not evolved to service the global and borderless nature of the internet. A global internet-native currency would offer low transaction fees, decentralisation, and the ability to facilitate micropayments — potentially flipping the advertising-centric model of the web.

The Question

Despite the internet being borderless and global by nature, it is still governed largely by the currencies of the nation states they originate and land in. Friction exists in making payments and many are locked out of using credit cards and bank accounts.

Every time you use a browser you see the familiar lock icon — indicating a site is secured by HTTPS. That standard for securing web traffic emerged from the same community now building crypto protocols. So far, there has been no equivalent standard established for financial transactions.

Why Micropayments Matter

Micropayments — transactions of less than a dollar, sometimes less than 1 cent — are not viable on the old financial system. Low transaction fees make crypto well-suited for facilitating these. The ability to pay say £0.01 to view a webpage, processed automatically from a wallet you control, received directly by the creator, could flip the advertising-centric model of the internet entirely.

The IoT and AI Connection

We have moved beyond it just being humans that need payment facilities. Machines will need means of payment and receipt for services. Imagine a vending machine that reorders its own stock, or AI agents executing transactions on your behalf. In the traditional world, a human would need to sit behind the account. Not so with smart contracts and crypto payments.

The Bull Case

At the root, all of humanity's achievements trace back to our ability for grand-scale coordination — basic stuff like bookkeeping. What has been created with the advent of cryptocurrency protocols is a way of coordinating economic activity with tamper-proof ledgers that are not owned by anyone — a shield against corruption.

Digital money represents a transformative shift in how we perceive and use currency. Unlike traditional forms tied to physical assets and government backing, digital money exists purely in electronic form — driven by advances in blockchain technology.

A noteworthy aspect of the current landscape: approximately 99% of stablecoin volume is denominated in dollars, effectively solidifying the US dollar's status as the de facto digital currency for global transactions.

Self-Custodied Money and AI

The rise of artificial intelligence is reshaping our understanding of transactions, particularly with the potential for AI-to-AI exchanges facilitated by self-custodied digital money. AI agents can analyse market conditions, assess risks, and make decisions — autonomously executing transactions using self-custodied funds.

This isn't science fiction. Smart contracts already automate agreements that previously required lawyers, accountants and settlement delays of days.

Cryptocurrencies vs CBDCs

Cryptocurrencies are decentralised and resistant to censorship, encouraging rapid innovation. CBDCs offer regulatory clarity but raise serious concerns about surveillance and government control of spending.

The most likely future is coexistence — users choosing between self-custodied crypto for autonomy and CBDCs for everyday stability. This diversity could create a more resilient financial system overall.

What This Means

Self-custodied digital money is poised to emerge as a dominant force — particularly as AI-to-AI transactions become an increasingly real use case for borderless, programmable money. The businesses that understand this early will have a significant advantage.

"ZK SNARKs are as important a technological breakthrough as blockchains themselves." — Vitalik Buterin, 2022

TLDR: zk-proofs were the original mathematical innovation. zk-rollups can help batch transactions and scale blockchains. zk-SNARKs and zk-STARKs are both methods of implementing zk-rollups. A future state can be imagined with hundreds of thousands of transactions settling via multi-layered, connected zk-rollup blockchains.

What is Zero Knowledge?

"ZK" is shorthand for zk-proofs — a breakthrough mathematical approach to sharing information. A zk-proof allows one party to prove to another that a given statement is true, while conveying no additional information beyond that fact.

A quick metaphor: imagine you're looking at a 'Where's Wally?' puzzle and want to prove to a friend you know where Wally is without revealing how to find him. You cut a hole the size of Wally in a large piece of card and place it over the picture — revealing only Wally. Proof without disclosure.

Why It Matters Beyond Privacy

The first implementations of zk-proofs in blockchain were for privacy — projects like Zcash. But Vitalik's excitement isn't about privacy, it's about scalability. zk-rollups bundle thousands of transactions in a batch and post only minimal summary data to the base layer — dramatically increasing throughput.

SNARKs vs STARKs

Both are types of non-interactive zero-knowledge proofs. SNARKs (Succinct Non-Interactive ARguments of Knowledge) are compact and fast to verify. STARKs (Scalable Transparent ARguments of Knowledge) don't require a trusted setup — making them more decentralised by nature.

Why This Still Matters in 2025

ZK technology is now at the heart of AI privacy, verifiable computation, and identity systems. The same mathematical principles that allow a blockchain to prove a transaction is valid without revealing its contents are being applied to AI model verification, private data sharing, and secure computation. If you work with AI, ZK proofs will touch your world sooner than you think.