.png)
Summer is behind us. I love to ski, and I’m anxiously awaiting the first snowfall.
If you ski, you know the fall line. Place a ball on a mountain and let gravity take over, and it will naturally roll in the direction of least resistance. That’s the fall line.
But least resistance doesn’t mean no resistance. Without friction, you don’t ski; you fall. Your edges create the resistance that lets you turn, control your speed, and choose your line. The goal isn’t to eliminate friction; it’s to have the right friction at the right time.
I’ve been thinking about that since getting back from SIBOS in Miami last week, where much of the conversation was about tokenized deposits, stablecoins, public blockchains, and interoperability. A lot of very smart people are working on the future of money. But I kept wondering whether we are asking the wrong question.
We spend a lot of time debating what kind of money will win: stablecoins or tokenized deposits, public networks or private consortiums, digital assets or traditional fiat.
A better question might be:
Is what you’re building increasing or decreasing friction in the network?
Imagine a bank creates a tokenized deposit that settles instantly and works 24/7. Then another bank creates its own, another consortium creates another, while stablecoins spread across different networks. Each may work beautifully on its own, but together they create a new set of islands that still need bridges, liquidity, conversion, and settlement between them.
We haven’t eliminated the friction. We’ve moved it.
Internet vs Intranet
This feels a lot like the old internet versus intranet debate. An intranet can be fast, secure, and purpose-built. The problem is that everyone else has their own intranet.
The power of the internet was that connecting once connected you to everyone else who had already connected. Shared protocols expanded the network. Companies could still control their products and customer experiences without needing to own the underlying network.
Henri Stern at Stripe made a similar point recently about crypto infrastructure: the value of an open, modular stack is that the best tools remain extensible, allowing developers to choose the components that work for them. That feels like an important design principle for money too. The goal shouldn’t be to make every institution use the same product. It should be to make different products work together.
Financial services has historically been more institution-centric. Your money exists inside a bank’s ledger, and moving it somewhere else means crossing a series of institutional boundaries.
Storing money vs Moving money
But the way people experience money is changing.
One observation at SIBOS stuck with me: previous generations often encountered banking for the first time by putting money into a bank. For younger generations, the first financial experience may instead be an app like Venmo or Revolut that helps them move money.
The old question was, “Where should I keep my money?”
The emerging question is, “What can my money do?”
That’s why I don’t think the useful debate is stablecoins versus tokenized deposits. Stablecoins can create silos too. A tokenized bank deposit can be incredibly useful if it becomes part of a genuinely interoperable network.
It’s not about the wrapper; it’s about the network. Maybe the simplest test is this: Does it make the network more connected, or simply add another layer that needs connecting?
And interoperability isn’t just technical. If I hold one token and you need another, there also has to be enough liquidity to exchange them reliably, at scale, and close to par. Connectivity without liquidity is only partial interoperability.
Which brings me back to skiing.
The goal isn’t frictionless money. Some friction creates trust and control. The problem is friction created by the architecture itself: prefunding, cutoff times, reconciliation, trapped liquidity, and bespoke integrations.
Over time, technology tends to route around that kind of friction and toward more open networks. Money will move toward deeper liquidity, lower costs, faster settlement, and greater reach.
Money will find its fall line.
