HRF’s Weekly Financial Freedom Report #4

For this week’s Financial Freedom report, we cover currency devaluation in Argentina, Hong Kong’s National Police arresting individuals for donating to pro-democracy activists, and recent product launches helping make Bitcoin easy to send worldwide.

We also feature two fascinating interviews: one with Femi Longe on how Africans must be builders, not consumers, in the new Bitcoin economy, and the other with Leopoldo López on the correlation between authoritarian regimes and hyperinflation.

Enjoy this week’s highlights!

Argentina | Currency Devaluation

Since assuming office on Dec. 10, Argentinian President Javier Milei devalued the peso by 55%, weakening the official exchange rate from 365 to 820 pesos per dollar and sending the prices of goods ranging from meat to plane tickets skyrocketing. Additionally, Milei reduced state spending on pensions, cut energy and transport subsidies, and increased taxes. As Latin America’s third-largest economy struggles with an economic crisis, a deep budget deficit, and a $44 billion debt to the IMF, Milei has made it clear that hard times lie ahead. The IMF said it “welcomed the measures announced” and that these would “help stabilize the economy.” Citizens have responded to Argentina’s ongoing currency collapse by fleeing into dollars, stablecoins, and bitcoin.

Hong Kong | Arbitrary Detention

Ever since Hong Kong’s National Security Law was imposed in 2020, the National Police gained sweeping new powers to surveil, arbitrarily detain, financially repress, and disappear dozens of civil society groups. Recently, four individuals were arrested and accused of providing financial support to activities supposedly deemed a threat to national security. What are the alleged criminal activities? Donating money to pro-democracy activists Nathan Law and Ted Hui. Donations were made and likely tracked through Patreon, a crowdfunding platform. As governments and police work together to eradicate dissent, there is a critical need for decentralized, pseudonymous mechanisms to donate to activists and civil society groups moving forward.

Lebanon | Ponzi Scheme

Riad Salameh, former governor of the Bank of Lebanon and the world’s longest-serving central banker, is being accused of corruption, fiscal fraud, and embezzling $330 million in public funds. While his tenure as governor has proved fruitful for his own wealth, the country’s financial health has imploded. National debt defaults and currency collapse have been just two causes of Lebanon’s financial woes, leading to catastrophic losses of millions of people’s savings. While the target is firmly on Salameh, he is just one part of a corrupt financial system focused on ensuring the continuation of the country’s kleptocracy rather than on its people’s financial well-being.

Egypt | International Bailout

The IMF officially announced a $3 billion bailout for the regime of Abdel Fattah El-Sisi, with CNN reporting that this amount could extend to as much as $10 billion. In the past decade, the pound has devalued from 6 per dollar to more than 30 per dollar, and HSBC expects the currency to depreciate to as little as 45 per dollar as part of the country’s structural adjustment. As a reminder, these savings-destroying currency measures are conducted by a tyrannical government with no democratic participation or oversight by the people.

Kgothatso Ngako | Most Impactful African Bitcoiner 

African Bitcoiners, a community account on X, acknowledges entrepreneur Kgothatso Ngako as the Most Impactful African Bitcoiner of 2023. From founding Machankura to enable Bitcoin use without the internet to Exonumia to translate Bitcoin educational content into native African languages, Kgothatso continues to innovate on ways that bring financial freedom to the millions of Africans excluded from the global financial system. At HRF, we are proud to support Kgothatso’s work to bring financial freedom tools and education across Africa.

Phoenix Wallet | Request Inbound Liquidity 

Previously, Phoenix mobile wallet users receiving funds over the Lightning Network would sometimes exhaust their inbound liquidity, resulting in having to perform expensive on-chain transactions. With a new wallet update on Android phones, self-custodial users can now plan ahead and avoid future on-chain fees by requesting inbound liquidity between 100,000 and 10 million sats with “the liquidity [being] guaranteed for a year.”

Discrete Log Contracts | Dollars on Lightning

10101, a self-custodial wallet enabling Bitcoin trading, launched a project that enables USD payments on Lightning rails. Users can pay any Lightning invoice using their USD balance, receive directly into their USD balance regardless of the sender’s wallet type, and have the unique advantage of owning bitcoin when they own USD. This is made possible through Discrete Log Contracts (DLCs) working in the backend to make a non-custodial peg to the dollar, helping shield users from Bitcoin’s volatility.

FASB | Updated Standards for Disclosing Crypto Assets 

The Financial Accounting Standards Board (FASB), a US regulatory body, released updated standards regarding the disclosure of certain crypto assets. Effective from the fiscal year beginning Dec. 15, 2024, the changes will allow firms and nonprofit organizations to use fair-value accounting for specific crypto assets on their balance sheets, reducing costs and complexity associated with previous accounting models. If you’re a nonprofit organization with bitcoin and cryptocurrency assets in the US, this update may be worth reviewing.

Opensats | New Grants

OpenSats announced 10 new grants. From enhancing Bitcoin education to strengthening Lightning Network security and enabling Fedimits to accept and send payments using a Lightning Gateway, these grants cover a wide range of projects. Grantees include Clams, Fully Noded, Validating Lightning Signer, Fedimint Lightning Gateway, Pickhardt Payments plugin for Core-Lightning, BitBanana, Crack the Orange, Bitcoin Core App, Krux, and Vexl.

River | Shareable River Links
Last week, River launched shareable River Links, marketed as an easy way to send bitcoin to anyone, anywhere, via text messages, social media, or email. Users simply enter the amount of bitcoin they want to send from their River account, copy the auto-generated link, and send to another person via text or email. The recipient can claim the bitcoin to their River account or any other wallet without KYC. Here’s a quick River Link demo by Marty Bent and Matt Odell.

Bitcoin Design Foundation | Grants Available 

The Bitcoin Design Foundation is a nonprofit organization supporting the mission to “design Bitcoin for everyone.” Believing that effective, intuitive, and beautiful design can be a catalyst for broader adoption, the Foundation is now providing grants to individuals to improve open-source Bitcoin design, user research, and more. You can find additional information on their grants here.

Bitcoin in Africa, feat. Femi Longe  

In one of the most profound interviews of the year, Femi Longe, program director at BTrust Builders, explains how the global economic and monetary system, in partnership with military dictators, continues to extract value from African civilians and details how, through his work with Btrust Builders, he aims to equip African software engineers with the skills they need to work in Bitcoin development as producers and builders, not consumers, and reminds us that utility helps Bitcoin adoption scale. Finally, he invites us to put our sats to work by investing in entrepreneurs and companies building Bitcoin applications to solve regional challenges.

Defending Democracy, feat. Leopoldo López

With the largest oil reserves in the world and stable democratic institutions, Venezuela was once one of the richest countries in Latin America. Since the country slid into a brutal dictatorship, Venezuela has faced a total economic, social, and humanitarian crisis. Through this lived experience, Venezuelan political leader and democracy activist Leopoldo López makes an astute observation: “If you look at the countries that have hyperinflation and the highest rate of inflation, they are all autocratic regimes.” For people living in these autocratic countries, finding a way to protect their monetary value is of utmost importance, and Bitcoin often stands as a useful alternative system.

Oslo Freedom Forum | Reserve Your Spot

Human rights advocates from around the globe will take the Oslo Konserthus stage on June 3-5, 2024, to share their efforts to defy repression and speak out against injustice. This year’s theme, Reclaim Democracy, emphasizes the pivotal role every individual plays within the global movement for democracy. The Financial Freedom team is looking forward to creating a program track exploring the role open-source money plays in preserving our human rights and civil liberties. Use the code 2024OFF to get an early bird discount on your ticket.

Until next time,

Ayelen Osorio

Financial Freedom Specialist

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