By 2035, your financial life will run on a quiet stack you barely see: credentials that prove who you are, what you’ve done and which risks you carry. Those proofs will move across apps and borders. They will unlock prices, credit, employment, insurance and public services. In that sense, your “financial identity” will spend like money. Not because the data itself becomes a currency with a central bank, but because it can be pledged, exchanged and programmed to settle outcomes.
🧩 What “Financial Identity 2035” Really Means
Let’s define terms with care. Financial identity is not a document, a bank account or a loyalty profile. It is the fusion of verifiable personal data, portable credentials and automated reputation that you can present on demand to execute economic value. Think of it as a live portfolio of proofs: that you paid back three microloans, that your utility bill is current, that you completed a skill certification last month, that a public authority confirmed your address. Each proof has a source, a timestamp and a permission.
Calling that “a new form of money” is more metaphor than literal claim. Money is standardized, fungible and designed for settlement at scale. Data is contextual and non-rival; copying it doesn’t deplete it. Yet if a merchant offers you a lower price after your wallet proves you are a low-fraud customer, your identity has directly produced an economic outcome. If a lender accepts your telco-derived repayment score as collateral for a working capital line, your identity has secured credit. In practice, those outcomes will feel like spending.
The stakes are higher than retail optimizations. When identity data confers access, pricing and claim rights across markets, it shifts who holds bargaining power. Employers can condition offers on credentials updated in real time. Insurers can require behavioral proofs for coverage. Governments can target subsidies with surgical precision. The boundary between “information about you” and “economic instrument you deploy” becomes blurry. That blur is the point of this essay.
🟦 The Mechanics: How Data Becomes Money
For identity to act like an economic instrument, it must be verifiable, portable and permissioned. Verifiable means a recipient can check that a claim about you came from a trusted issuer and wasn’t tampered with. Portable means you can carry the claim across apps, devices and borders without re-onboarding. Permissioned means you can consent granularly to share a minimum necessary slice, and revoke it.
The toolkit for this already exists in pieces. Verifiable credentials allow issuers to sign claims about you that your wallet can present to a relying party, which can then cryptographically verify them. Decentralized identifiers give you addressable identities that are not tethered to a single platform. Tokenization of data rights allows you to wrap a specific permission to use a dataset or model feature in a transferrable instrument with conditions attached. Permissioned APIs expose your data from banks, telcos and platforms in standardized formats with secure consent.
Privacy-preserving cryptography is the glue that makes this safe at scale. Zero-knowledge proofs let you show a fact (I am over 21; my income exceeds a threshold; my lateness rate is below x percent) without revealing the underlying data. Secure enclaves execute code on sensitive data in hardware-isolated environments, allowing risk models to run without exposing the raw inputs. Federated learning keeps training on-device or in distributed silos, sharing only learned parameters. These approaches turn “identity” from a static dossier into a programmable interface.
When those components interlock, identity can behave like cash, collateral or a programmable payment instrument. A unit of exchange: your wallet presents a “trusted buyer” credential to an online marketplace, triggering an instant seller discount without leaking your full history. Collateral: a small business bundles provable revenue credentials from multiple platforms to secure a line of credit at a better rate. Programmable instrument: a subsidy is paid only when a credentialed training program attests completion and employment after 90 days, with zero-knowledge receipts to protect participants.
🟦 Core Standards and Building Blocks
The building blocks will not be invented from scratch. Standards and compliance regimes are quietly converging, and interoperability will decide who participates and at what cost.
| Standard or Pattern | What It Enables |
|---|---|
| W3C Verifiable Credentials (VC) | Issuers sign claims you can present and others can verify without phoning home |
| Decentralized Identifiers (DID) | Portable identifiers not tied to a single platform, with resolvable public keys |
| OpenID Connect / FAPI | Secure login and consented data access across apps and financial APIs |
| PSD2/Open Banking style APIs | Permissioned access to bank data and payments initiation with user consent |
| eIDAS 2.0 / EU Wallet | Government-grade identity and credential wallets recognized across borders |
| FIDO2/WebAuthn | Phishing-resistant authentication that anchors wallets to devices securely |
| Zero-Knowledge Proofs (ZK) | Selective disclosure and attribute proofs without revealing underlying data |
| Secure Enclaves / TEEs | Confidential computing for risk scoring and settlement logic on sensitive data |
| Data Portability Flows (GDPR/CCPA/CDR) | Legal right and mechanisms to move your data between providers |
No single standard does all the work. The interesting bit is orchestration. A verifiable credential anchors a claim, an OpenID profile brokers a session, a consentful API transports the data, a zero-knowledge proof narrows what is revealed and a hardware enclave evaluates risk and executes terms. The less you notice any of this, the more mature it has become.
💡 Why 2035 — The Drivers Accelerating This Shift
Why not 2027 or 2050. Timing matters because technology and incentives are finally aligned. AI is pulp-hungry; it needs labeled, high-integrity, identity-linked data to improve models that price risk, fight fraud and personalize services. That data will not flow freely without portable credentials and accountable consent, which creates demand for standardized identity plumbing.
Ubiquitous sensors and wallets are everywhere, and they normalize proof-bearing interactions. Smartphones, passkeys and platform wallets already store transit cards, IDs and payment instruments. It is a short step to add employment credentials, income attestations and verified skills. As more of life is mediated by software, the value of being able to prove things about yourself without oversharing rises.
Regulators are nudging in the same direction. Data portability mandates in Europe, Australia and Brazil push firms to open interfaces and honor user consent. The EU’s eIDAS 2.0 and national digital identity programs signal that cross-border, state-recognized credentials are coming to consumer devices. Payments regulators continue to promote competition in account-to-account rails. All of this lowers the friction of moving identity-linked value.
Finally, incumbents need new revenue as advertising saturates and interchange fees face ceilings. Data brokerage in the shadows is politically fragile. Consent-first models with clear pricing and shared upside are more defensible. If you can price and meter the use of a specific credential or reputation feature, you’ve found a product with margins. The question becomes who captures those margins.
⚙️ Common Misconceptions and Conceptual Traps
Three myths crop up repeatedly and they mislead design and policy.
- Myth 1: “Data is money” in a fungible sense. Reality: most data is contextual, perishable and non-fungible; specific proofs can act like money in narrow contexts, but a gigabyte of “identity” cannot be swapped like a banknote.
- Myth 2: “Technology alone will protect privacy and fairness.” Reality: cryptography reduces leakage, interfaces reduce friction, but without clear rules, audits and recourse, asymmetries persist and abuse scales.
- Myth 3: “Decentralization equals democracy.” Reality: decentralized systems often re-centralize around gatekeepers who control wallet distribution, consent flows or discovery.
Each mistake has practical consequences. If you assume fungibility, you build exchanges for “data tokens” that look liquid but redeem poorly in real markets. If you assume technology fixes power, you omit due process, redress and audits, which is how bias and exclusion become systemic. If you assume decentralization equals fair outcomes, you miss that the wallet pre-installed on two billion devices sets de facto policy.
The safer mental model is instrument design. Identity-linked data yields value when it changes terms of trade in a specific context without unacceptable externalities. That raises boring but vital questions: who issues the credential, who verifies it, what happens when it is wrong, how revocation works, and who gets paid when it is used.
🟦 Evidence From Today: Trajectories, Not Destiny
Aadhaar in India showed what happens when a country creates a ubiquitous, low-cost identity layer. Linking identity to payments and services enabled large-scale subsidy delivery, eKYC and new business models. It also raised questions about exclusion when biometrics fail, data protection when databases sprawl and redress when errors occur. Identity can enable scale, and scale magnifies both benefits and harms.
M‑Pesa in Kenya and its cousins demonstrated how identity-light wallets can leapfrog card infrastructure. Over time, those wallets grew features that look more like identity: contact networks as reputation, transaction histories as collateral for products such as M‑Shwari. The arc bent toward identity-enriched finance because it improved underwriting and reduced fraud.
Europe’s PSD2 and open banking frameworks changed the permissions of data sharing. Third parties can access account data or initiate payments with user consent, and banks must provide secure APIs. That shift created room for budgeting apps, alternative scoring and account-to-account payments. It also illustrated how standards, certification and liability rules are as important as code.
China’s digital yuan pilots and broader digital identity infrastructure offer a different angle: deep integration of identity, payments and policy. Programmable features allow time-limited subsidies or merchant-specific incentives. Tighter coupling also increases state visibility and control. That model is not easily exported, but it shows how identity-linked money can operationalize public policy at the transaction level.
At the frontier, “data dividend” experiments and identity-based scores using telco or utility data are testing distribution and pricing. Some platforms let users opt into data-sharing programs for rewards. Alternative lenders use call detail records, bill payment histories and device metadata to assess risk for the underbanked. The lessons are mixed: access expands, costs fall for some, and new exclusion patterns emerge when data proxies correlate with protected traits.
The honest takeaway is not inevitability but direction. Identity-rich finance is workable, valuable and politically contested. Countries will choose different trade-offs. Markets will find ways to monetize high-quality, consented proofs. The rest is governance.
🟦 Who Gains, Who Loses: Power, Value Capture and Risk
Platforms that already sit in the consent flow are positioned to win. Operating systems with default wallets, banks with trusted pipes, and large consumer platforms with regular authentication events will intermediate identity transactions. They can charge rent for verification, aggregate logs and influence which credentials are accepted where. Incumbency matters.
Identity brokers and verification utilities gain too. If every lender, insurer and employer needs fast, high-assurance checks, firms that aggregate attestations from governments, employers and platforms become toll collectors. Their margins depend on exclusivity and trust. Expect consolidation.
Who loses. People with brittle or sparse records, often the already marginalized, face the highest risk. If your biometric doesn’t scan well, your address is informal, or your work is off the books, a world that prices verifiable proofs can harden exclusion. Small firms without access to identity pipes may pay higher costs or accept worse terms. Developers who cannot integrate the “right” wallet will be sidelined.
Systemic risks follow the value. Surveillance is the obvious one: if every transaction carries an identity proof, logs accumulate. Even with privacy tech, metadata leaks. Rent extraction grows quietly through certification fees, revocation services and preferred wallet status. Algorithmic discrimination can hide behind sanitized proofs when underlying models replicate bias. And then there is the liquidity illusion: markets will try to securitize and trade baskets of “data rights” and “reputation features.” Prices can look precise while redemption is messy. A lender might pay for a stream of verification rights only to discover that user consent is revoked at scale, leaving an asset with face value and little yield.
This is why governance, not just crypto-economic ingenuity, determines outcomes. Liability rules, public options, audit mandates and competition policy shape who captures value and who bears risk. Code can implement policy; it does not substitute for it.
🟦 Counterarguments and Alternative Futures
There is smart pushback to the thesis. Data is non-rival and can be copied at near zero cost. That undermines the scarcity that makes money work. Even if you tokenize usage rights, copying the raw data often remains possible, and the enforcement costs may outweigh the benefits. If privacy and antitrust regulators tighten restrictions on monetizing personal data, many imagined markets will not clear. And democratic societies may choose public identity infrastructures with strict limits on commercial use.
These critiques do not negate the trajectory; they bound it. They suggest we should expect instruments that meter usage of specific proofs in narrow contexts, not grand commodity markets for “identity.” They also make room for alternative institutional designs.
Three credible 2035 scenarios can coexist across regions:
– Marketized identity economy. Private wallets, verification brokers and platform-mediated consent dominate. Identity proofs are priced per use, and bundled into subscriptions. Public policy sets guardrails but does not run the stack. Winners are platforms and large financial institutions that own the pipes.
– Regulated public infrastructure. Governments or regulated utilities provide a national wallet, core credentials and public APIs. Private firms build on top but must honor portability, auditability and open access. Value capture skews toward services that add risk expertise rather than gatekeeping.
– Fractured patchwork with high inequality. Regional standards, platform silos and weak public capacity produce incompatible wallets and black markets for verification. People with strong credentials enjoy cheaper credit and access; others face a maze of workarounds. The system is efficient for some and punitive for others.
The choice among these is political. Technology lowers the cost of coordination, but it cannot pick values.
🟦 Practical Conclusions: What Policymakers, Firms and Citizens Should Do Now
Policymakers should treat identity as infrastructure. Mandate portability so people can move credentials without penalty. Require auditable consent logs, with standardized formats that regulators and consumers can read. Enforce anti-lock-in with interoperability obligations for dominant wallets and verification utilities. Set liability rules that specify who pays when identity proofs fail or are abused. Fund public options for core credentials, including revocation services and offline fallbacks.
Technologists should resist bespoke brilliance. Implement interoperable standards first, invent later. Treat privacy-preserving primitives as first-class features: zero-knowledge selective disclosure, verifiable computation and confidential enclaves in risk pipelines. Build explicit suspensibility and redress into systems: easy revocation, proof re-issuance and dispute workflows. Document model behavior on synthetic and real populations, and publish bias audits with reproducible tests.
Firms should adopt consent-first business models. Make the value exchange transparent: if you ask for a credential, state why, how long you will retain it and what the customer gains. Pilot data dividend experiments where frequent, high-value credential uses trigger automatic rebates. Diversify verification sources to avoid over-reliance on a single wallet or broker. Prepare for verification as a line item in unit economics, not a tax you hide.
Individuals can start small. Use credential wallets that support selective disclosure. Prune app permissions quarterly. Prefer services that let you prove attributes instead of sharing raw documents. When possible, request and review your own data and scoring features. Ask your lender which attestations they used. These micro-habits create demand for better design.
A cautionary but pragmatic note: whether identity “becomes money” depends less on cryptography than on the institutions we build around it. The code will work. The question is who it works for.
CTA: Run a 15-minute data due diligence on yourself. Export permissions from your phone, browser and bank, and ask what a lender would infer today.
CTA: If you build products, audit your consent flow now. The wallet your customers use will decide your margins in 2035.
📚 Related Reading
– The Wallet Wars: How Default Identity Layers Tilt Markets — https://axplusb.media/wallet-wars
– Portability With Teeth: Designing Data Rights That Actually Move — https://axplusb.media/portability-with-teeth
– Zero-Knowledge in the Real World: When Privacy Tech Changes Prices — https://axplusb.media/zk-prices