Last year a series of downturns, from the collapse of stablecoin Terra to the bankruptcy of the FTX exchange, caused crypto assets to lose over 70 percent of their value. Fourteen years after the invention of Bitcoin, none of its promises seem to stand. What was intended as a form of digital cash is hardly used as a means of payment due to its intrinsic volatility. A financial system designed to be free from the potentially unreliable intermediation of banks is mired in a network of opaque, unregulated, and occasionally fraudulent new intermediaries. The “digital gold,” conceived as a safe asset and hedge against inflation, has suffered a loss of purchasing power ten times larger than the dollar.

What remains of crypto after all the hype? Not little: the blockchain, a true technological breakthrough, offers substantial advantages. Thanks to the blockchain, users can access digital services without surrendering their data to a centralized entity. As data increasingly becomes an instrument of power and control, blockchain appears as the foundation of a web 3.0, no longer subject to the dominance of large corporations, more open to competition and to inclusive forms of democratic governance. But crypto assets are not just one of the potential applications of blockchain; they are also the fuel that makes it work.

At this lecture, sponsored by the Democracy and Capitalism research project at the Neubauer Collegium, economic historian Luca Fantacci (Università degli Studi di Milano, Italy) asked, how can we reap the advantages of the blockchain without all the vagaries of crypto?