In Seattle, most everyone who works in and around Amazon’s headquarters is just certain the company is working on a phone. People even will point to the floor from the street near one of the shiny new Amazon corporate buildings and talk about how it’s “off-limits.”

Why, you ask?

Because of “the phone.”

So last September when some started to speculate about the possibility of an Amazon phone, it didn’t seem all that surprising, in part because the project has become a big draw for local Seattle wireless talent and has, as I said, become a worst-kept secret.

But many aren’t surprised, because it just makes sense. After all, this is the company that made the Kindle Fire as a response to Apple’s iPad. And while many who talk about an Amazon smartphone talk about it in terms of it being another Kindle Fire–like content consumption device, I think an Amazon phone is going to be less about selling Amazon digital goods (though it will do plenty of that) and strategically more about connecting Amazon customers with the physical world as a mobile wallet.

Why is that? Because as Square and Google become increasingly important mobile wallets and commerce platforms that likely would freeze out Amazon mobile payments efforts, other digital and web-first companies like Facebook are taking baby steps to create payment and gift systems that connect their storefronts to the physical world. While some may see the news on Thursday about Facebook as just being an interesting new approach to gift cards, I think the social network has designs on becoming an increasingly important payments platform for digital and physical goods, something that Amazon likely recognizes.

And it’s not like Amazon’s own payment system hasn’t been rumored for a while. In fact, the rumors of an Amazon mobile payments platform came out about the same time as the smartphone rumors last fall. While most people didn’t really talk about them in the same breath, I suspect they are connected.

So that’s the strategic reasoning for an Amazon phone. But what would an actual Amazon phone be like? Your guess is as good as mine, but I have no doubt that Amazon will be innovative in this regard, loading up the device with a nice UI on top of Android — much like the Fire — and its own app store, and it could even have an innovative subscription model tied to Prime (much in the way the company rewards Prime members with free digital books as well as shipping).

I also think Amazon could be innovative around the network approach. There have been rumors that Amazon is launching an MVNO, which is a possibility (T-Mobile USA is, after all, just across town, and I am sure it would talk to the e-tailer about renting out its network).

I could always be wrong about this. Amazon’s Area 51 could be for something entirely different, and all of its mobile hiring could be just a great head fake from a savvy and secretive company.

But I doubt it, because Amazon wants to be your future digital wallet.