HRF’s Weekly Financial Freedom Report #17

Hong Kong | New National Security Law Aims to Suppress Dissent

Hong Kong’s Legislative Council passed a new national security law increasing state power to suppress dissent, a move that raises even more fear over the erosion of civil liberties. This legislation expands on a draconian national securities law previously introduced by Beijing. The earlier law came in response to Hong Kong’s pro-democracy protests, made a wider range of dissenting acts illegal, and led to the arrests of hundreds of protesters and activists. The new law, Article 23, introduces severe penalties, including life imprisonment for acts of treason and insurrection and decades of imprisonment for espionage, disclosure of state secrets, or collusion with external forces. Activists and journalists expressed concerns about the potential implications of Article 23 on their daily lives and work since it could create gray areas that are exploitable by authorities to target dissent and impose harsh penalties. Without question, government agents will use the banking system as a tool to impose Article 23.

India | The Indian National Congress has Bank Accounts Frozen

The Indian government, led by Prime Minister Narendra Modi, froze the bank accounts of its largest political opposition, the Indian National Congress (INC), citing alleged tax violations mere weeks before the upcoming election. According to statements from the INC on X, “all our bank accounts have been frozen. We cannot do our campaign work. We cannot support our workers and candidates. Our leaders cannot travel from one part of the country to the other.” Just days after this development, India’s financial crime agency also arrested opposition leader Arvind Kejriwal in what is seen as a broader action to eliminate competition in the upcoming elections. These events highlight the growing need for a neutral, apolitical currency as a tool for democratic activism and political campaigning.

Iran | New Law Allows Auto-Fines of Women Non-Compliant With Hijab

The Iranian parliament recently passed a law imposing fines on women who violate mandatory hijab regulations, allowing money to be directly deducted from their bank accounts without their consent. The enforcement of this law will use AI facial recognition technology, surveillance cameras, and personal data to identify offenders, with repeat violators facing fines of $400. This measure comes as part of Iran’s broader hijab bill and has seen escalating social tensions surrounding its enforcement after the murder of Mahsa Amini, who was detained by Iran’s “morality police” for breaking the mandatory hijab in 2022. At the same time, Iranian citizens have been experiencing hyperinflation and an isolated currency for many years. Here, Bitcoin has emerged as a useful tool, offering women and men a currency that can’t be arbitrarily seized or censored if used properly.

Argentina | Locals Dumping Dollars for Bitcoin

Amid 274% inflation, Argentinians are opting for Bitcoin over US dollars to protect their savings, according to Bloomberg. This trend is evidenced by a surge in Bitcoin purchases, reaching a 20-month high based on data from the country’s top cryptocurrency exchange. Grappling with an acute economic crisis, Argentina elected Javier Milei in December, who committed to financial austerity that has produced mixed results for the country. Since taking office, Argentina has secured its first budget surplus in 12 years, the peso has strengthened 10% against the dollar, and inflation has cooled. However, poverty levels remain at a 20-year high of 57%, and food insecurity has intensified following Milei’s decision to temporarily suspend funding to 38,000 meal centers, prompting public outcry. While the results of Milei’s policies remain uncertain, what is clear is that Argentinians are increasingly adopting Bitcoin.

Nigeria | Gluwa Behind Many Countries Push For CBDCs

As central bank digital currency (CBDC) adoption grows on the African continent, financial services firm Gluwa has become a central player in assisting regimes with their CBDC initiatives. Building on their partnership with the Central Bank of Nigeria for the eNaira CBDC, Gluwa is now engaged in similar projects in Liberia and is exploring support for Ghana’s eCedi CBDC. In light of recent events, such as the crackdown in Ghana on LGBTQ rights, election violence in Liberia, and Nigeria’s clampdown on alternative currencies, the risks of CBDCs have never been more clear. Their programmable nature can give authorities even more control over citizen microfinancial activity, helping to explain the extreme interest from dictators and authoritarians.

Cuba | Protests Over Blackouts and Food Shortages

The city of Santiago in Cuba is facing severe challenges, including 18-hour daily blackouts and food shortages that have sparked protests where demonstrators are demanding “power and food.” These demonstrations coincide with the government’s decision to implement a fivefold increase in the cost of fuel, all while wages remain stagnant. The spike in fuel prices has paralyzed the economy and exacerbated the difficulties Cubans are facing, including high inflation, widespread poverty, and a severe national food crisis that has led to reduced food rations for children and pregnant women. Rather than acknowledging the gravity of the situation and taking remedial action, Cuba’s foreign minister took to X to blame the US, declaring that “the US direct and cruel responsibility in the harsh economic situation affecting the wellbeing of the Cuban people is well known. The US government, especially its embassy in Cuba, must refrain from interfering in the country’s internal affairs and inciting social disorder.”