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The Future of Money: Stablecoins, AI Analysts, and Gen Alpha's Digital Wealth

  • Writer: horizonshiftlab
    horizonshiftlab
  • 2 days ago
  • 16 min read
A person holds a glowing Bitcoin. The background is split: digital network on the left, urban skyline on the right, creating a futuristic mood.
Image Source: AI Generated via Canva

The future of money is rapidly shifting from physical cash to a fully digital system, forcing a global re-evaluation of age-old financial systems. This episode explores three major signals in this realm, starting with Gen Z and Gen Alpha, who are proving to be the most financially savvy, digital-first generations. Gen Alpha is learning to manage money as young as seven, with nearly half of their parents reporting that their kids introduced them to digital financial tools. Younger generations are earning money differently, with 42% of teens earning digitally through roles like influencers, online sellers of apparel, or in-game currency.


The hosts also discuss stablecoins as a potential bridge to widespread digital currency. Stablecoins are cryptocurrencies pegged to a stable asset like the US dollar or gold, offering stability without the wild fluctuations of typical crypto. A major signal pointing to the widespread adoption of stablecoins is the rumored multi-billion-dollar acquisition of a stablecoin infrastructure company by MasterCard. Finally, the conversation highlights a disruptive force in finance: an AI model (Terminator) developed by Stanford and Boston College that outperformed 93% of human portfolio managers by an average of 600%. This raises crucial questions about the future of human advisory roles, the need for greater financial inclusivity for older generations, and even the possibility of returning to bartering in closed communities or in space.





Is Cash Dead? How Gen Z, Stablecoins, and AI are Redefining the Future of Money


The fundamental nature of money is undergoing a global re-evaluation. With digital payments becoming the norm and cryptocurrencies challenging centralized systems, the very way we transact, save, and grow our wealth is being torn down and reconstructed. This presents a tremendous opportunity to design financial systems that better suit the modern world.

Here are the key forces—from generational shifts to major tech acquisitions—that are defining the future of money.


1. The Digital-First Generation: Gen Z and Gen Alpha

The future of money is in the hands of the youngest generations, who are entirely digital-first and are becoming financially savvy at an astonishingly early age.

  • Financial Literacy from Childhood: In the Asia Pacific region, children are learning to manage money as young as seven, with 94% of Gen Alpha having access to a financial account.

  • A Shift in Influence: Nearly half of parents in one survey reported that their children are the ones who introduced them to digital financial tools.

  • Digital Earning: A large percentage of teenagers are earning money digitally (42%). High earners among US high school students—those making over $10,000 a year—are often influencers. They are also earning money by selling clothes, footwear, and apparel online, or through in-game currency and video game tournament prizes.


This trend indicates a generational shift where older professionals may benefit from learning the newest financial tools from younger mentors, normalizing saving and investing earlier in life.


2. Stablecoins: The Bridge to a Digital Currency Future

While volatile cryptocurrencies like Bitcoin have made headlines, the more stable, yet digital, alternative is poised to become the essential bridge to widespread digital currency adoption.

  • What are Stablecoins? A stablecoin is a cryptocurrency where the transaction is verified and recorded by a decentralized system, but its value is pegged to another asset—such as the US dollar, gold, or other highly stable crypto. This design brings the security of cryptography with the stability needed for everyday transactions, making it less erratic than traditional crypto.

  • The Big Signal: Mastercard's Move: The strongest signal for mass adoption is the rumored acquisition by Mastercard of ZeroHash, a crypto stablecoin infrastructure company. If this multi-billion dollar deal goes through, it would accelerate stablecoin integration into the mainstream money lives of consumers, moving society closer to a truly digital economy.


3. AI and the End of the Human Analyst

Artificial intelligence is not just managing your personal portfolio (robo-advisors); it is challenging the expertise of Wall Street's human financial analysts.

  • The Terminator Model: A paper from Stanford Business School and Boston College described an AI model, dubbed "The Terminator," developed to test whether AI could outperform human portfolio analysts.

  • Outperformance: Using only publicly available information, this AI model beat 93% of diversified funds and, on average, outperformed previous managers by 600%.

  • The Future of Financial Expertise: This finding, initially thought to be a mistake, raises serious questions about the future role of human analysts in financial advisory roles. Already, some hedge funds are using AI to consistently outperform the market with very few human analysts, suggesting a major transformation in how investment management is done.


The Extremes: Digital Currency vs. Bartering

While the future is moving swiftly toward digital and AI-managed money, the world may also see a return to older systems of exchange, often driven by choice and necessity.

  • Interplanetary Payments: As humanity pursues colonization of Mars and the Moon, current payment systems—which rely on near-instantaneous processing—will not work interplanetarily. This opens the door to using democratized currency like crypto for space, or even a return to bartering for precious resources like oxygen and food.

  • Value-Driven Communities: On Earth, some people are choosing to live in communities where the concept of money is replaced by bartering and exchanging work or effort for food and shelter. This shows a link between changing personal values and a re-shuffling of fundamental economic systems.


The future of money is a fascinating landscape where hyper-digital systems and ancient bartering can coexist, driven by generational competence, technological innovation, and a desire to redesign the systems that govern our wealth.



Selected Links:

Cryptocurrency and Finance
AI and Investing


Episode Transcript:

Raakhee: (00:00)

Hello and welcome to Signal Shift with me, Raakhee and Sue. Last week we delved into the future of investing. It was such a fun experience and highlighted the possibilities of how we will be able to invest our money in the years to come. This week we want to talk about the very nature of money itself. I exclusively use my Apple Pay on my phone.


I'm just someone who enjoys not having a handbag or not having too much stuff in me, right? So I try to keep it really minimal and just keep my phone on me. And this is so funny, but I've noticed this whenever I'm in the store with somebody who's like 65 plus, they are always so entertained when I pull out my phone. And this technology has been there for a while.


But for whatever reason in my life, the older people just always like, wow, do you always pay with your phone? And it's really cute. But it just gets me thinking about money and how are we going to use it and where are we going to use it and what it's going to mean and look like. And my god, there's so many questions here. So yeah, are we even going to need money? Are we still going to call it money? Those are exactly the debates that happening, not just, I think, in this conversation, but around the world in the last three years. And many more leaders coming together to discuss exactly this. Our world systems are in a phase of destruction and reconstruction. And it poses a tremendous opportunity to re-evaluate the age-old systems and whether they work for us or not. And to design better systems that suit the needs of the times now. And I think money falls straight up in this realm.


So Sue, what did you find to share with us with regards to the future of money today?


Sue: (01:45)

Thanks, Raakhee. Yeah, it is nice when you don't have to go out with a huge handbag and have cash and all the things. So it's definitely something. But every once in a while when you find a place that's cash only, you're like, what? No, I don't have any. Anyway, so the topic is the future of money. And that made me think, well, who has the future of money right now? It's Gen Z and Gen Alpha. And I thought, well, long gone are the days of when you put your coins in your piggy bank growing up and you see what that looks like and parents actually teaching their kids about financial literacy. If anything, kids are now much more financially savvy and looking for ways to make money starting at an early age. So I saw a couple of reports that were really interesting. So MasterCard issued a survey and this was specifically for the Asia Pacific region, but


People are learning to manage money as young as seven years old. 94 % of Gen Alpha in that region already has access to a financial account. 58 % hold digital wallets, 49 % hold investment accounts. And what about their parents? Well, nearly half of them said their kids are actually the ones that introduced them to digital financial tools. So...


Tables are totally turned and you know, it makes sense. Like they're a total digital first generation. So the future of money really lies with them. So what are they doing, right? They're actually earning money earlier and just differently. So I'm sure babysitting gigs still exist, things like that, but 42 % of teens are earning money digitally and 38 % are doing it more traditionally.


But the high earners, there was an article in Fortune that said every US high school has at least one kid making over $10,000 a year. And interestingly, most of them who are earning the higher echelons of money are usually influencers. Brands are reaching out to them, things like that. But interestingly, a lot of teens are selling things online. So the number one thing is that they're selling clothes, footwear, and apparel, then they're streaming for video games, they're actually earning in-game currency, winning video game tournament prizes, things like that. So it was just interesting to me that the future of money still lies in like this digital ether of things that you can keep currency in a game, for instance, that you value might never come out of the game. You know what I mean?


And yeah, it's just that the future of money is just through all these different digital products. So to me, I was thinking this is another example of where the educational tables are turned. And it would really be helpful to have younger mentees from Gen Alpha and Gen Z of like, what are the financial tools that you're learning from right now? If anything, it's encouraging to know that more young people have much more of a handle, hopefully, on financial literacy because there has been this phase where money and money out on your phone, it doesn't really like translate well into the real life. So there's more consumption than there has to be. And so, you know, this is a way of learning more about savings and investment. So super, super interesting. That's where the future of money is.


Raakhee: (05:00)

You touched on so much stuff that I'm like, ting, ting. With what? I have a question. I mean, one of the things that came up for me was how old were you when you got your first bank account?


Sue: (05:11)

Think like not till at least the end of high school, maybe college. What about you?


Raakhee: (05:17)

Yeah, similar. Like I was 16, 17 Yeah. And the time kid of the year or so. And, you know, it was this young girl who won this year. And it spoke about everything you're kind of speaking about, Sue, which she kind of started her own startup, invented something, did something. But it's really around helping prevent scammers from scamming elderly people and helping elderly people, an educational site for them.


It speaks to exactly all the things you're speaking, which is young people teaching older - people, right? And we see this generational shift and I think all, yeah, know, digital products, just a different way, starting to earn money so much sooner, really having the heads wrapped around it so much sooner.


You mentioned MasterCard. I'll jump into the guess which is my signal. I wanted to talk about the whole concept of stable coin. And people might have heard about it.


You might have heard of it in passing and I'm not certain everybody knows what it means. I certainly didn't for the longest time. But I think it could be a really good bridge to get us to digital currency. And I think that's why I wanted to speak about it today and an exciting thing happening in that space that I think we're going to hear news about very, very soon. But I wanted to recap with just reminding us and myself really, OK, what is crypto again? And what does it mean? And what is stablecoin? And how does it work?


But again, just a reminder that cryptocurrency now is simply just digital currency in which the transaction is verified and recorded by a decentralized system, right? Not a centralized kind of entity or body. And it uses this concept of cryptography, which is just creating codes, right? Codes that nobody can break, all the things that...


Money should become, right? I mean, it should move towards that way as everything tends to move digital. Now, traditional currency like the US dollar, of course, is government-issued money, and it's dependent on the government to manage the supply and demand.


So stable coin is in essence a cryptocurrency that it meets all the other criteria, but its value is pegged to another asset. So in essence, could literally be pegged to the US dollar. It could still be dependent on the value of the US dollar or something else, gold, whatever it may be. But it still operates the way any other cryptocurrency would. But that's why it's called a stable coin. It's meant to bring that stability. And that's what's interesting about it is, can it be the bridge between where we are now to fully getting us to being digital, right? And really moving away from money systems because as much as we've spoken about it and crypto has been so big and so wild, part of what the problem is with crypto, right? Being so wild and so erratic. We've seen unbelievable value and many millionaires and billionaires made out of things like Bitcoin, right?


But as a society we have in transition to this technology that all sits there that makes sense. And I stable coin, I think it might be the bridge to that. Stable coin itself, you can have four types, right? Which is one is fiat backed in essence, like US dollar, traditional currency like that commodity gold. It can even be crypto backed as long as those sort of the crypto that it backs, those companies are also decentralized and they hold a lot more in their reserves. So again, a lot more stability in those crypto currencies. They can also be algorithm backed. So this is literally crypto that's then managed by computer codes, which is kind of wild. But again, they would circulate more or deflate to increase the price, right? Based on what's happening with the algorithm.


So still very safe as much like, oh, it's algorithm. It's set up with certain rules and boundaries. So still all much more safer ways than kind of the wild, the wild world of like, oh, cryptocurrency making goes high and big and as erratic as we've seen some cycles be, which I think makes everyone nervous. But I think the big signal and why I'm thinking, are we moving this way? This is coming really soon is there are rumors right now. There's still rumors. It's not confirmed, but.


I mean, you can read up about this, but Mastercard is aiming to acquire a crypto stable coin infrastructure company, company that deals with this, does this, it's called ZeroHash. And so I've been checking the news every day. This is like last four days ago. There's still lots of, you know, news stories out about this. I just saw earlier today, this company obtained another type of license, which is another indicator that this deal might go through and might happen.


There were rumors with MasterCard of another company a while back. So I think everyone's dealing with this with caution, but it would be a 1.5 to 2 billion acquisition. if a company like MasterCard acquires this, we really, again, I think I'm moving much more closer to stablecoin becoming a reality for all of us in our money lives.


What what else did you what was your


What other signals did you have?


Sue: (10:07)

Gosh, I feel like there's so many others I could share. It's obviously hot topic right now. And to be fair, this one might've belonged in the future of investing. So I'm not sure, but again, just thinking about the future of money, how you grow it. I was thinking about what the next step will be for investment funds. And I saw not too long ago, I think in the summer, Stanford Business School published a paper. They said they had developed along with Boston College, an AI model called the Terminator. It's called the Terminator because the question was, you know, could they actually, using public information only, could they outperform previous portfolio analysts and their stock picks? Could they pick like an ultimate stock picker? And they called it Terminator, I guess, because of where this is going, right?


So they reviewed over 3,300 different actively managed and diversified funds every three months. And they put in some parameters where they could adjust it, again, using only public available information. Well, this AI model beat out 93 % of those managers and not only by that, by 600 % as an average. And the original question was, are investors losing out on potential because they aren't analyzing publicly available information, but this really answered a whole different question.


They actually thought it was a mistake that they kept going back saying these results can't be true. But when looking at it, they said, no, this is real. And so it begs the question of, the future with your money, who are you going to trust to manage this? And to be fair, one of the things the professor said was, this is in comparison to previous funds where they didn't have AI as a model, your gains are not going to be that much more edged out in the future because so many more funds will have AI.


And so there was an article also in Bloomberg that said there was a hedge fund in Sydney where I think it was called Minotaur. They used AI to beat the market, at least in this past six months, and it consistently outperformed. And so this is a fund that has, I think they had no analysts on their team and they worked alongside one other firm that had maybe like one or two, just like a very few a very narrowly staffed team.


And so this was really begging the question about the role of junior analysts on Wall Street in the future, if everything is gonna go to AI and who you're really gonna trust to manage your money in the future. So just thought it was really, really interesting. Again, maybe this is more future of investing, but again, who manages your money is just a really important question.


Raakhee: (12:44)

So I think, you know, this thing, like it screams out at me in what the message is from AI, right? AI, taking away those jobs. it's advisory. It's advisory roles, which is coaches, financial analysts, it's lawyers. People turn to AI models for all kinds of questions now, right? It is the prime advisory for people from their businesses to their personal lives to the astrology charts, what you're saying is 100 % spot on.


Sue: (13:15)

Yeah, it's really interesting to see again how much more caught up the younger generations are and how ready they are for a lot of this to happen. But again, the question is who misses out, right? And so when you were talking about even being in line to see more elderly people looking at you paying with your watch or your phone, right? It's just like, what's next? And I got to find the data, but there was a survey, right, about who's missing out on crypto.


Again, what's it going to take to kind of normalize it? And really the people who are most comfortable with it are males, right? Age 18 to 49. but it's especially older people and women who are really skeptical of this and not, and just under no circumstances will invest in crypto, which I think possibly an issue going forward to your point, the more digital we're going to become. So yeah, how to make this more inclusive and who's getting to define the terms of like how people are using money.


Yeah, the one thing I read, and I think this was from a few years ago, is JP Morgan puts out this annual magazine called Payments Unbound. It's a partnership with Wired Consulting, where they put out these kind of provocative ideas about the future of money and payments, really. And they had a really interesting piece on space. The more we go to the moon, and likely we'll try to colonize Mars, right? All of these things.


What will happen to payments? Because right now, all the things we're talking about is possible because we're so wired and things take just a fraction of a second to process. when you're in interplanetary systems, it's not going to work that way, at least for the beginning. And so they were posing really interesting questions about using something intergovernmental, right? Because they have a treaty where not one government can kind of own anything on planets, right? So


What does that look like? And is that an area for crypto or some kind of democratized currency? Or do you go back to bartering? Because oxygen will be so precious, right? There will be food that will be so precious. Like, are those kind of the systems of currency that we're going to go back to in a certain way? So I just thought that was another really, really interesting thought experiment, maybe for now my generation, but future generations for sure, who are exploring.


What possibilities exist out there and how the heck are you going to get anything paid for? Out on Mars!


Raakhee: (15:44)

Yeah, I love that too. I mean, I think we're gonna see bartering in so many different places, right? Even people who maybe are scared to do the digital world and wanna choose a different system. So interesting. saw, I think it was CNN, a clip of a lady who, I think it was in the last week, and I'm sure it's gone pretty big, who spoke about not being able to find a job. She's 41.


She's been at it for I don't know how long and has now come to that point of peace of what can and can't be. And she's going to live at kind of like a Buddhist retreat sort of place where she exchanges her work and her effort to live there and have food. And I mean, that's barter -, know, I reading about another community, I think it's somewhere in India, similar thing, like people will go, there's no money.


There's no concept of money there. They don't talk about it. It's not a real thing in that community. So I think we'll see it on space. I think we'll see some of it on earth as people are choosing different ways of living. Because money, it's tied to values, right? In a certain sense. And so it links back to what's my value system.


And as we know, there's a lot of that that's changing and shuffling for people. So yeah, really, really, I mean, we've spoken about this before in other episodes and so fascinating digital currency and robot advisors on one hand and literally a society that is going to live in communities and barter on the other. So fascinating times. Sue thank you so much. This was great. I hope you enjoyed this week's episode.


Do you have any cool information on what's happening in the future of money or what are your new money habits that you've adopted in the last few years and what excites you about what's coming? Let us know in the comments. Thank you so much for being here and we will catch you again next week. Bye for now.

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