What’s new at DCI?
Latest Newsletter
In this issue:
Two new Bitcoin Core developers: Wladimir returns and Sebastian joins us
New paper on privacy and the digital pound with the Bank of England released
Neha Narula selected for Rockefeller Foundation’s Bellagio Center Residency
Student researcher Ishaana Misra wins Chaincode’s inaugural Bitcoin Scholarship
And more...
Blog Posts
Neha Narula, Director of the MIT Digital Currency Initiative (DCI), has been selected for the Rockefeller Foundation's 2025 Bellagio Center Residency.
Why does innovation in financial services matter to everyone, and how can the public sector support its advancement? On Thursday, September 26, MIT’s Digital Currency Initiative was privileged to host a visit and fireside chat at the Media Lab on these questions and on the future of money with Dr. Agustín Carstens, General Manager of the Bank for International Settlements in Basel, Switzerland.
Madars Virza SM '14, PhD '17, a Research Scientist at the MIT Media Lab's Digital Currency Initiative (DCI), is the recipient of an IEEE Symposium on Security and Privacy Test of Time Award for “Zerocash: Decentralized Anonymous Payments from Bitcoin,” a paper he co-authored in 2014.
On April 22-23, the MIT Bitcoin Club hosted the 10th MIT Bitcoin Expo. DCI director Neha Narula gave a keynote speech, Cryptoeconomic Systems managing editor Reuben Youngblom presented a talk titled "The 70 Megaton Gorilla: Addressing the PoW climate narrative," and DCI software engineer Sam Stuewe presented an asynchronous talk titled "Are We CBDC Yet? A Healthy Dose of Skepticism." Sam also mentored participants in the Expo's Hackathon.
On Tuesday, January 17th at the World Economic Forum in Davos, Switzerland, Axios markets reporter Courtenay Brown and MIT Media Lab Digital Currency Initiative director Neha Narula considered the most pressing issues facing cryptocurrency today including how (and if) the industry should be regulated, how governments and financial institutions should interact with the sector, and how investments could be safeguarded. The View from the Top sponsored segment featured Ripple chief executive officer Brad Garlinghouse.
On Tuesday, January 17th at the World Economic Forum in Davos, Switzerland, Axios markets reporter Courtenay Brown and MIT Media Lab Digital Currency Initiative director Neha Narula considered the most pressing issues facing cryptocurrency today including how (and if) the industry should be regulated, how governments and financial institutions should interact with the sector, and how investments could be safeguarded. The View from the Top sponsored segment featured Ripple chief executive officer Brad Garlinghouse.
Five years ago, I was in the Boston area for a week and I hung out at the DCI.
It wasn't much of a space back then—really more like a closet. But there were ethernet ports in the walls, assorted cables, and computer accessories, and a couch with occasional undergrads hanging out, coding, or discussing the finer points of cryptocurrencies. It was welcoming, and a lot of fun. I brought a computer and started working, and talking to people about Bitcoin, and helping some students with their projects…
The Bank of England announced an agreement to collaborate on a twelve-month Central Bank Digital Currency (CBDC) research project with MIT Digital Currency Initiative. The agreement supports and builds on DCI’s ongoing research into CBDC, while also contributing to the Bank of England’s wider research and exploration of central bank digital currencies. While no decision has been made on whether or not to introduce a CBDC in the UK, the work will investigate and experiment with potential CBDC technology designs and approaches, and evaluate key tradeoffs, opportunities, and risks. This type of research can help inform wider policy development by contributing important technical ideas and questions.
Today, the Bank of Canada announced an agreement to collaborate on a twelve-month CBDC research project with the MIT Digital Currency Initiative. The agreement supports and builds on the DCI’s ongoing research into CBDC, while also contributing to the Bank of Canada’s wider research agenda into digital currencies and fintech. The work will investigate and experiment with potential CBDC technology designs and approaches, and evaluate key tradeoffs, opportunities, and risks. While no decision has been made on whether or not to introduce a CBDC in Canada, this type of research can help inform wider policy development by contributing important technical ideas and questions.
We’re excited to share that AJ Towns is joining the Digital Currency Initiative to lead our Bitcoin Software and Security Effort (please find his announcement below). This four-year research and development program is designed to continue to harden the Bitcoin network and steward the industry’s commitment to funding open source software. The effort will include contributing to Bitcoin Core development as well as longer-term research, such as investigations into the stability of rewards and software to provide strong robustness and correctness guarantees. It will also include attracting talent in network and operating system security, compilers, programming languages, testing, and more to join the effort.
View the DCI presentation and fireside chats from the 2021 MIT BItcoin Expo here
In the Media
“MIT DCI Director Neha Narula: How Academia Interacts With The Bitcoin Ecosystem
A talk with the director of DCI at MIT, Neha Narula, on the role academia plays in the Bitcoin ecosystem and how that might evolve over time.”
“In the West there has been significant resistance to the concept of retail central bank digital currencies (CBDC) based on ‘Big Brother’ concerns. In other words, privacy fears that the government can monitor personal payment transactions. Or sometimes, even concerns that they might attempt to control behaviors. Hence, the Bank of England and the Massachusetts Institute of Technology Digital Currency Initiative (MIT DCI) published a paper exploring privacy enhancing technologies (PETs) for a possible digital pound.”
“This week MIT’s Digital Currency Initiative (MIT DCI) released the source code of research into smart contracts for central bank digital currency (CBDC) – PArSEC (Parallelized Architecture for Scalably Executing smart Contracts). Given the solution is designed for central banks, it is a centralized offering and sidesteps using blockchain, although it supports Ethereum smart contracts. “
“The Massachusetts Institute of Technology (MIT) Digital Currency Initiative (DCI) has introduced the experimental PArSEC platform. PArSEC — short for "parallelized architecture for scalably executing smart contracts" — is open source and developed with central bank digital currency (CBDC) in mind. “
“Although crypto enthusiasts may now be inclined to distance themselves from FTX, the episode reflects ‘the crypto we created,’ says Neha Narula, director of the Digital Currency Initiative at MIT.”
DCI senior advisor Chris Calabia was interviewed on his experience as a regulator, his advice for innovation, and more. Chris worked for over twenty years at the Federal Reserve Bank of New York. Through that role and others, including as a Senior Advisor on regulatory policy at the Bill & Melinda Gates Foundation, Chris has worked closely with regulators from all of the world, providing him a unique perspective not only into the mindset of US regulators, but regulators in many different socioeconomic contexts.
Potential designs may involve intermediaries in new and different ways
Central bank digital currencies potentially offer, in a digital form, the advantages of central bank money: settlement finality, liquidity and integrity. However, both offline and online commerce are susceptible to fraud and other kinds of disagreements. The existing techniques for managing fraud and disputes focus on giving users easy access to chargebacks, which relies on intermediaries to resolve disputes. Potential designs for CBDC may involve intermediaries in new and different ways, or may not use intermediaries at all, calling into question how to address fraud if CBDCs become widely used.
A private research university established in 1861, the Massachusetts Institute of Technology (MIT) is one of the world’s most prestigious schools and ranked first in the QS World University Rankings in 2023 due to its academic and research excellence in multiple fields, including blockchain.
The Endless Thread team is excited to introduce a new mini-series: Tales from the Crypto, or three windows into the wild world of cryptocurrency. It's a landscape ripe for investors, gamblers, opportunists, and academic investigators — both online and offline. At every turn, our hosts and producers have turned to experts to make sense of this volatile, ever expanding terrain.
In the series' first installment, co-hosts Ben Brock Johnson and Amory Sivertson dive into a viral tweet about NFTs aiding Ukrainians with the war effort against Russia, as well as plans for a crypto island paradise that was never meant to be.
Last summer, a special subcommittee of the US Senate met remotely to weigh the benefits of launching a central-bank digital currency, or CBDC—something that could, if optimally designed, transform the US financial system, making it more accessible to more citizens. For senators staring intently at their laptops, this was basically the first day of digital-currency school. And to introduce them to this highly technical world, the first witness that Senator Elizabeth Warren called was MIT Digital Currency Initiative director Neha Narula.
Collaboration with Federal Reserve Bank of Boston yields progress in understanding how a digital currency might be developed in the future.
CAMBRIDGE, Mass. -- In collaboration with a team at the Federal Reserve Bank of Boston, MIT experts have begun designing and testing technical research through which further examination of a Central Bank Digital Currency (CBDC) can be performed in the U.S.
The effort, known as Project Hamilton, is in an exploratory phase, and the research is not intended as a pilot or for public deployment. Instead, the researchers have explored two different approaches that could be used to process transactions, and thus could indicate the technical feasibility of a potential CBDC model. In a process involving significant design flexibility, the MIT group tested factors such as the volume and speed of transactions, and the resilience of the systems in general, among other requirements for a viable digital currency.
Nick along with A.J. Towns, Tim Ruffing and Pieter Wuille are the authors credited for writing the three BIPs that made up Taproot, the most significant Bitcoin upgrade in four years.
DCI Director Neha Narula co-authored the piece, "Why Central Bank Digital Currencies?" published in the Federal Reserve Bank of New York's Liberty Street Economics
“In the past year, a number of central banks have stepped up work on central bank digital currencies (CBDCs – see map). For central banks, are CBDCs just a defensive reaction to private-sector innovations in money, or are they an opportunity for the monetary system? In this post, we consider several long-standing goals of central banks in their support and provision of retail payments, why and how central banks tackle these issues, and where CBDCs fit into the array of potential solutions.”
China is beating the U.S. when it comes to innovation in online money, posing challenges to the U.S. dollar’s status as the de facto monetary reserve. Nearly 80 countries — including China and the U.S. — are in the process of developing a CBDC, or Central Bank Digital Currency. It’s a form of money that’s regulated but exists entirely online. China has already launched its digital yuan to more than a million Chinese citizens, while the U.S. is still largely focused on research.
The two groups tasked with this research in the U.S., MIT’s Digital Currency Initiative and the Federal Reserve Bank of Boston, are parsing out what a digital currency might look like for Americans. Privacy is a major concern, so researchers and analysts are observing China’s digital yuan rollout.
Neha discussed her Subcommittee Hearing: Building A Stronger Financial System: Opportunities of a Central Bank Digital Currency on June 9th and DCI’s current collaborative CBDC project with the Federal Reserve Bank of Boston, with Scott Nover of Quartz.
MIT’s Digital Currency Initiative has launched a new academic journal, called Cryptoeconomic Systems.
It’s a step toward a more robust academic dialogue around blockchain and crypto topics
DCI Director Neha Narula took part in The New Yorker’s “How Memes Become Money” discussion. Watch the highlight reel by clicking here.
If you are trying to grasp Bitcoin and understand what China’s digital yuan means, America’s Federal Reserve is right there with you.
America’s Federal Reserve says it is in no rush to issue a digital currency, but it is coming under intense and increasing pressure to research and understand the design and potential of digital money.
Neha Narula was interviewed for Bloomberg Quint on “What is the Future of Money?”. View the video below and read the full interview here
In an article by Forbes’s Nina Bambysheva on February 13th, 2021, Madars Virza’s paper “Zerocash: Decentralized Anonymous Payments from Bitcoin” and Tadge Dryja’s “The Bitcoin Lightning Network: Scalable Off-Chain Instant Payments” were named as one of “The 10 Most Important Scientific White Papers In Development Of Cryptocurrencies.