WHY THIS MATTERS IN BRIEF
If you want to suppress people you do two things – send in the military and cut off their funding, and Bitcoin is making the latter harder.
Bitcoin was recently touted as a way to solve global poverty, and help over two billion undocumented people get access to a raft of new services and recently its value hit an all time high after Tesla announced it had bought $1.5 billion worth of the cryptocurrency. After its launch in early 2009 Bitcoin has gone through a lot of ups and downs, and some of its biggest price swings were in 2017 and 2018 when a steep rise followed by an 84 percent decline bought plenty of hype and headlines. After a relatively quiet period though the last three months of 2020 saw yet another sharp rise as the currency’s value more than tripled.
Not surprisingly, more and more investors are now jumping on what can still seem like a techy, trendy bandwagon. In an economy where governments are printing money hand over fist, people want a more secure place to put their assets. In addition to prevailing economic uncertainty, many institutional investors are dipping their toes into the cryptocurrency, and even PayPal began offering customers the ability to buy Bitcoin late last year. Elon Musk’s repeated endorsement of the cryptocurrency hasn’t hurt either with some even believe digital currencies like Bitcoin are the future of money, and as both China and India spin up their own initiatives to create what would be the world’s first sovereign cryptocurrencies they wouldn’t be wrong.
But intertwined with Bitcoin’s more speculative potential, whether that’s as an asset or a currency, is an important feature many investors may miss – its power to protect human rights and stand against tyranny.
In a new video for Reason magazine, Alex Gladstein, Chief Strategy Officer at the Human Rights Foundation, explains why the cryptocurrency is an inalienable tool for helping preserve freedom, and how it’s being used by people in different parts of the world to do so.
Right or wrong? Genius or flawed?
Everyone knows money makes the world go round which also makes it a perfect tool for surveillance and control as China discussed a few years back as they saw cryptocurrency as a way to track every purchase, manage the economy in real time, and monitor their population in ways that they could never have dreamt of in a cash society. Furthermore, the decline of cash in many societies and its replacement with digital payment methods means we’ve all but kissed financial privacy goodbye with all of our digital transactions now increasingly logged and kept on record for years.
In most democratic countries this doesn’t tend to come with consequences much more intrusive than targeted ads. But for the more than four billion people living under authoritarian regimes, it’s a very different story.
Their governments, as we’ve recently seen with the clamp down and detention of pro-democracy protesters in Hong Kong can, and often do, freeze peoples’ bank accounts, shut down ATMs, decide who gets cut off from financial services, and even seize private funds. Actions like these are often targeted at individuals labelled as problematic – activists, dissidents, union leaders, critics of the ruling party, intellectuals, and the like. Cutting off access to money is a quick and dirty way to immobilise people and quell sedition, not to mention wreak havoc when it’s done on a large scale.
If only there was a monetary system not controlled by a central bank, untouchable by governments, where value could be transmitted without corruption or interference and unaffected by international borders.
Enter Bitcoin – censorship resistant, seizure resistant, borderless, permissionless, pseudonymous, programmable, and most importantly decentralised and peer to peer … But, while it shows great promise, especially when it comes to helping individuals circumvent certain aspects of authoritarian regimes or “unfavourable” policies it’s not all great news, especially as governments like India start debating new laws to ban private cryptocurrencies, like Bitcoin, and find new ways to wield power and exert their influence.
As always, the game of cat and mouse continues, and right now in most governments eyes Bitcoin, and it’s crypto peers, are in their sights.