Dave Aiello is the co-founder and CEO of Token Labs, a Providence-based peer-to-peer money transfer network using the digital currency bitcoin that was recently accepted into the MassChallenge Boston 2017 accelerator cohort.
Aiello spoke with Providence Business News about the startup he founded along with Matt Mitchell, Token’s chief technology officer, and their hopes for MassChallenge.
PBN: How did the two of you come together to found Token?
AIELLO: A few years ago, Matt and I were both heavily involved in the bitcoin community. I first reached out to him after reading something he had posted on an online bitcoin forum, as we both had similar ideas about a particular kind of bitcoin-related service that we wanted to see built. We started chatting and brainstorming a bit online, and slowly but surely started building the technology that’s behind Token.
PBN: What’s the basic premise of Token? How is it different from similar bitcoin exchange services on the market?
AIELLO: Well, we aren’t an exchange service ourselves – what we do is connect people with bitcoin exchange services around the world so they can easily buy and sell bitcoin with their local currency wherever they may be, and our software (available as a mobile app and on the web) allows people to take full possession of their bitcoin and easily send and receive funds peer-to-peer. Our service is particularly useful in cross-border transactions, where sending bitcoin peer-to-peer is much cheaper than any alternative currently available, including Western Union, PayPal or bank wires.
The experience of using our service is not much different than what you would expect when you use a service like Venmo or PayPal. The big difference is that when you are using these services, they are acting as a middle man in every transaction you make. This makes these services very expensive to operate, and the customer eventually ends up paying for it. When you use Token, we’ve designed our software so that nobody but you has access to your funds – not even us. This is a unique feature of cryptocurrencies like bitcoin, in that they do not require a third party to move funds on your behalf. As long as you are armed with an internet connection and the proper software, like Token, you can be your own bank. Our software makes using bitcoin in this way very simple.
PBN: On Token’s website, you have a quote by economist F.A. Hayek about taking money “out of the hands of government.” How does that quote play into your mission for Token?
AIELLO: As citizens of Venezuela or Zimbabwe can likely attest, when an institution has the power to issue a country’s money, the urge to abuse that power is immense. And the urge to keep that power is also immense. It has long been taken for granted that this is a role that simply must be entrusted to governments. But the invention of digital currencies like bitcoin allows us to have money without borders, where people can send and receive real value around the globe instantly, without the need for a central authority. The monetary policy is transparent to all, and not subject to political influence. In a world where the internet allows information to travel freely around the globe, the borders we see on maps still act as arbitrary financial barriers between us. With bitcoin and digital currencies, we are now able to move toward a more global, transparent and interconnected economy. Token was founded with the intention of building this world.
PBN: Despite the hype, digital currencies like bitcoin have yet to penetrate the mainstream market. Do you see that changing in the future?
AIELLO: Like the adoption of any new technology, the adoption of bitcoin by mainstream consumers is following a familiar trend. Initially, new technologies are adopted by innovators and enthusiasts, who help to build out the technological infrastructure and spread initial awareness. As the technology becomes more useful, mainstream consumers slowly begin to adopt it. Eventually, if the technology offers enough of an advantage over the traditional way of doing things, the adoption will become more widespread.
Right now, bitcoin is still in its infancy, and a lot of the infrastructure that will make its beneficial properties more useful for mainstream consumers is still being developed. For people in the United States, when it comes to most financial activities, the old way of doing things works well enough. My debit card will pay for my coffee, and the merchant can deal with the fees. But in a place like Venezuela, where the old way of doing things is rapidly failing, I think this is where we will first start to see mainstream adoption of digital currency. In time, once the inherent benefits of this technology can be made tangible to the masses, the rest of the world may follow.
PBN: What are your goals as a MassChallenge startup? Where do you hope to be at the end of the program?
AIELLO: We are very excited to have been selected for MassChallenge, and to have the support, structure and mentorship to help us achieve our goals as a company. Right now, our service is launched in beta and accessible by invite only, but by the end of the program we hope to have our mobile app and website fully launched. You can request an invite or find out more about us at www.token.me.
Kaylen Auer is a PBN contributing writer.
