HRF’s Weekly Financial Freedom Report #15

BRICS | Exploring New Payment System

BRICS — an intergovernmental economic organization led by the Chinese, Russian, and Saudi dictatorships and including Brazil, India, South Africa, Egypt, Iran, Ethiopia, and the United Arab Emirates — is exploring the development of a payment system that will likely introduce central bank digital currencies. “We believe that creating an independent BRICS payment system is an important goal for the future,” Kremlin aide Yury Ushakov said, “which would be based on state-of-the-art tools such as digital technologies and blockchain.” Eight of the 10 BRICS countries are authoritarian regimes, and their own new digital payment system will only further increase financial surveillance, economic centralization, and censorship for the billions of individuals who live under their rule.

China | Facial Recognition Flags Journalist as Threat

During China’s annual parliamentary sitting, a journalist from Ming Pao newspaper was the victim of an alarming incident: facial recognition systems flagged her as a threat for discussing risks related to the Chinese economy. Specifically, she was questioned about owning Evergrande shares and visiting the Bureau of Letters and Calls, both of which she denied. Further investigation would later reveal a mistaken identity, leading to her release. This incident offers a window into China’s extensive use of facial recognition technologies to crack down on dissent. With a vast network of billions of cameras spanning the country, citizens are tracked in real-time, identified in large crowds, and shamed on public billboards; their money is frozen, their movement is restricted, and anyone who steps out of line is detained, or worse. At the same time, the Chinese Communist Party has been publishing less and less economic data over the last few years, ushering in a new age of opacity.

Garry Kasparov | Placed on Financial Blacklist

Following the murder of dissident Alexei Navalny, Russia’s financial watchdog has addedGarry Kasparov, a former world chess champion, renowned political activist, and chairman of the Human Rights Foundation, to its roster of “terrorists and extremists.” Kasparov declared this “an honor that says more about [Vladimir] Putin’s fascist regime than about me.” Perhaps this unfounded label comes from Kasparov’s history of pushing for democratic reform in Russia. In 2005, he founded the “United Civil Front,” a social movement opposed to Putin’s regime, and in 2007, he helped form “Other Russia,” a political opposition coalition dedicated to enacting political reform. Five years later, Kasparov was arrested outside a Moscow court and beaten by police before seeking refuge in the United States. Russia’s government is increasingly targeting human rights groups, independent media, and civil society groups, restricting these organizations from receiving donations and foreign funds as well as freezing their bank accounts.

The Economist | Feature on Bitcoin Mining in Africa

The Economist recently published an article detailing how Bitcoin mining tends to gravitate toward regions with cheaper, renewable energy sources. Africa, with thousands of gigawatts of untapped geothermal and hydropower, as well as massive amounts of wasted energy, has emerged as an appealing destination for Bitcoin miners seeking lower power costs and increased profits. The connection to freedom is twofold: first, without electricity, human rights aren’t attainable. There are 600 million Africans lacking electricity, but Bitcoin mining is beginning to bring some of them online today. Second, as Bitcoin mining accumulates on off-grid sites in Africa and beyond, it makes the network more decentralized and harder to stop. This article is definitely worth a share and a read.

Nigeria | State Arrest of Binance Employee

Nigerian authorities detained two Binance executives and seized their passports upon landing in the country. State forces are cracking down on cryptocurrency exchanges and their employees, whom they argue are destabilizing the economy. The executives could face allegations of currency manipulation, illegal operations, and tax evasion. In addition to the state arrests of Binance employees, Nigerian authorities are pressing for a list of Binance’s 10 million Nigerian users and demanding $10 billion in compensation from the company. Nigerians are witnessing the state cut off all exit ramps to its collapsing fiat system and take bold actions — like arbitrary detention — to ensure access to alternative currencies is restricted during an economic crisis. In reality, Bitcoin isn’t why the Nigerian economy is collapsing, but it is a way for people to escape.

Bitcoin | A Tool For Human Rights Activists

According to a new Forbes article, dictators wield their power by freezing or shutting down the bank accounts of people they don’t like or consider to be a threat to their rule, leading activists to adopt bitcoin. “Pro-democracy activists around the world sometimes rely on bitcoin as a money of last resort,” the author writes. One such example is activist (and Human Rights Foundation intern) Win Ko Ko Aung. In early 2021, Myanmar’s regime froze his bank accounts after he spoke out against the military junta and advocated for peaceful civil disobedience. “I [was put] on the wanted list [one] evening, and then the next day I could not access my bank account,” Aung said. He was able to flee the country with his Bitcoin holdings and sell some in Thailand to cover his expenses. This article highlights how, for Aung and countless other activists around the world, Bitcoin emerges as a lifeline that lets them operate, transact, and fundraise permissionlessly when they have been unbanked by dictators.