Alin Dragos, SF ’17, Head of Strategic Partnerships at the MIT Digital Currency Initiative (DCI), doesn’t read the current narrative of cryptocurrency innovations as a battle among competing token systems to dominate the digital currency landscape. Quite the contrary, he sees the success of multiple platforms as a victory for all of us.

Alin Dragos, SF ’17

“In cryptocurrency and blockchain technologies, we’ve invented a fast, efficient, secure, and transparent way to move value around the world that reduces the current level of friction and intermediation,” says Dragos. “The win here isn’t for any single platform, it’s for everyone in the world who buys, sells, or exchanges anything of value with another person or company.”

Upgrading a very old infrastructure
Dragos and his DCI colleagues—along with many like-minded leaders in technology, business, finance, and public policy—consider the world’s current banking systems to be inefficient and exclusionary. “Many unnecessary costs and hurdles have been introduced over time by intermediaries who no longer add enough value to the system to justify the fees they extract,” he says.

Cryptocurrency platforms are opening up the banking sector to a whole range of new participants. “Many more players can compete to offer accounts and other digital financial services to consumers who currently don’t have access to traditional saving, borrowing, and credit mechanisms,” Dragos notes.“I’m excited that so much innovation is now being driven from outside the established banking sector.”

Transparency, censorship-resistance, and the question of cash
Countries that are struggling with corruption can benefit from the transparency inherent in cryptocurrencies. “The technology has acquired an aura of being untraceable, but that simply is not true,” says Dragos. “Bitcoin, in particular, has gotten a bad rap as being an effective vehicle for money launders. But money laundering is more prevalent in our existing global banking system than it is on any cryptocurrency platform. The difference is that if you do bad things with bitcoin, sophisticated regulatory and law enforcement units will very likely catch you.”

Dragos also likes the fact that any economic activity employing bitcoin is resistant to censorship. “You cannot stop transactions from happening among willing parties, even if you wanted to,” he says. “In that sense, bitcoin preserves a fundamental societal benefit of cash.”

On the topic of cash, Dragos poses an interesting question inspired by the rise of cryptocurrency. “If cash didn’t already exist, would we invent it today? Some countries say yes, but others say definitely no. The next key question is whether we should have the digital equivalent to cash. In its current incarnation, cash comes with certain rights. Should we preserve those rights as we move to digital replacements? We must involve as many people as possible in open discussions of these questions. And we must make sure we carry forward the societal benefits that cash provides.”

The uphill battle to preserve privacy
When it comes to privacy protection, Dragos sees a challenge that reaches far beyond cryptocurrencies. “You can be as privacy-minded as you want, but the world is leaking data in every direction,” he says. “The more you stay online, the harder it is to remain anonymous. Anonymity will be lost without someone caring to protect it. Some people in the blockchain space are being proactive, but this shouldn’t be any one player’s responsibility. If we all advocate for it, we may have a chance of doing better than we are now.”

Dragos notes that blockchain technology has heightened the world’s interest in cryptography. “We see more interest in the field today than anyone has experienced in the last 20 years. It’s really cool now to be a cryptographer, and people who’ve been at it for a long time have a new impetus for their work. Current cryptography techniques were not designed for large-scale deployment, so we have plenty of room for innovation.”

The essential optimism of the MIT Digital Currency Initiative
Dragos and his colleagues at the DCI have made it their mission to create a future in which moving value across the internet is as intuitive and efficient as moving information. “We envision a tipping point where a critical mass of people demand the autonomy, openness, and value-generating capacity inherent in cryptocurrencies,” he says.

Although the technology still has a long way to go, Dragos contends that we’re already better for having it. “We need a great deal of fundamental research and development,  but the genie is certainly out of the bottle. Many smart, well-funded people are determined to make cryptocurrencies work for society at large, and I’m confident it will happen sooner rather than later. Adoption is already nearing tens of millions. In ten years, it will be hundreds of millions. By 2040, I expect it will be billions. Which is all the more reason to be sure we get it right from the start.”