If America doesn’t get over its collective drone paranoia, it could lose any chance of becoming a global innovation leader in an industry that some say could become an $80 billion business opportunity by 2025. The most obvious symptom of this drone paranoia is to interpret every new unexplained drone sighting as further proof that the U.S. military-industrial complex has upped its game to make a total surveillance state a reality.

Take, for example, the latest incident of the X-37B “space drone” that everyone’s talking about. Nobody really knows what the unmanned space shuttle look-alike was doing up in orbit over the past 674 days before it landed on Oct. 17 at Vandenberg Air Force Base in California. And the U.S. government isn’t saying, which has people surmising about all kinds of conspiracy theories. Maybe the X-37B was part of a U.S. master plan to take out global terrorists? Maybe it was used to spy on the Iranian nuclear program? Or maybe it was part of a sinister military strategy to capture enemy satellites in orbit?

The scary thing is, once drones do go mainstream, we can expect even more of these paranoid drone stories to circulate. Anytime we look up in the sky, we’ll have fodder for the next wild drone conspiracy theory. For now, drones are basically limited to military and government use, but there are plenty of people champing at the bit to use drones for just about everything – from monitoring crops to delivering packages. That means drones will soon be everywhere, not just patrolling borders or helping to put out wildfires. Hollywood producers already have the go-ahead to use them for film production, and signs point to the FAA will finally approve drones for commercial use by the end of 2015.

And, unlike the X-37B space drone that was orbiting in space, well out of view of anyone, the next generation of drones will be flying low enough to watch us in ways that will feel a lot more creepy. That’s bound to increase the potential for drone paranoia, especially among the political class, which has already latched on to drones as a possible campaign issue. Sen. Rand Paul famously summarized what drone paranoia feels like to many Americans: “I just don’t like the concept of drones flying over barbecues in New York to see whether you have a Big Gulp in your backyard or whether you are separating out your recyclables according to the city mandates.”

The problem is, all this drone paranoia could have a chilling effect on innovation. Instead of devising new uses for drones, we’ll spend all our time devising anti-drone technology. We’ll be walking around in anti-drone camouflage, carrying around special personal drone detection systems and reaching for special devices that can disable the video cameras and infrared capabilities of drones. The more money that companies need to spend lobbying for drones, the less money they’ll have to pump into drone R&D. And that will be bad for innovation.

For now, the best way to address all the safety and privacy concerns is to have as much transparency as possible about who has drones and why. Since the Pentagon and Homeland Security account for most of the drones being flown today in the United States, it means that the greatest transparency has to start with the very people who probably want the least transparency possible when it comes to drones. That being said, there have been some encouraging signs. For example, organizations such as the Electronic Frontier Foundation (EFF) and Citizens for Responsibility and Ethics in Washington (CREW) have successfully forced the federal government to open up about its drone fleets. And now comes signs that the White House is about to sign an executive order forcing all federal agencies to detail how and why they are using drones.

Until we get total transparency from the federal authorities, we’ll continue to harbor drone paranoia. We’ll think that every new X-37B is part of some international conspiracy plot. Partly this is true because of the history of drones: any innovation that starts out with military applications first is bound to come with its share of psychological baggage. And, let’s face it, when products have names like “Predator” and “Gorgon Stare” and “Constant Hawk,” it’s hard to pretend that they are being used for anything other than counterterrorism and law enforcement purposes.

However, as Benjamin Wallace-Wells pointed out in a New York magazine cover story on the current drone zeitgeist, there’s another big reason why so much drone paranoia exists: There has always been a fundamental human belief that objects capable of flying above us and having a “God’s-eye view” of the world must inevitably look down on us and view us as just objects rather than people. With this “dehumanization” comes a “threat,” an essential disconnect between man and machine.

To get over this psychological hurdle, the next round of drone innovation will need to convince people that drones can do a lot of good in areas not even tangentially related to warfare. Drones will have to become “humanized.” Imagine delivering packages to out-of-the-way places in the world; ultra-intelligent farming drones reducing the cost of irrigating crops; or search-and-rescue drones saving lives in remote locations. That type of do-good innovation with a human face to it might just be the only to prevent drone paranoia from crippling the future of drone innovation. The best and brightest should be inventing new and productive uses for drones, not spending their time finding ways to keep them out of the sky. Maybe then we’ll learn to stop worrying and love the drones.