Bitcoin can help human rights activists who have been de-banked.
Pro-democracy activists around the world sometimes rely on bitcoin as a money of last resort, which is a crucial use case that sets it apart from other assets.
“As human rights defenders, we work with very sensitive information, and financial information is the most sensitive information,” Open Dialogue Foundation President Lyudmyla Kozlovska told me in an interview. “Authoritarian regimes and dictatorships use this information to destroy activists, journalists, women's rights organizations, and LGBT rights organizations.”
Kozlovska referred to how autocrats can shut down the bank account of anyone they deem a threat, and how debilitating this can be. An example of this is when the authoritarian military regime that currently governs Myanmar froze the bank accounts of Burmese author and tech enthusiast turned activist Win Ko Ko Aung. Win Ko Ko Aung spoke out against the government in early 2021, shortly after the military overthrew the democratically-elected government that had been in power. The government charged him with violating a penal code it had just implemented, which criminalized anyone spreading “false news” or “causing fear.”
The newly-instated government put Win Ko Ko Aung on a wanted list after he advocated for peaceful civil disobedience, quickly freezing his bank accounts. All the while, Win Ko Ko Aung did not know he had violated any laws.
“I [was put] on the wanted list [one] evening, and then the next day I could not access my bank account,” Win Ko Ko Aung told me in an interview.
Win Ko Ko Aung fled the country, crossing into Thailand on foot. There, he sold some of his Bitcoin BTC 0.0% and crypto assets, which he could still access, to cover living expenses in the country before the U.S. government permitted him to resettle in the U.S. as a refugee. He currently interns at the Human Rights Foundation, which provides support to pro-democracy activists around the world through bitcoin.
Kozlovska personally experienced something similar. Since 2018, both Kozlovska and ODF the organization have been denied financial services, plus had bank accounts frozen or shut down at four different banks, plus two financial service providers (Wise and Revolut), in addition to losing access to fundraising platforms like Patronate and GoFundMe. All this happened due to ODF’s work in three countries governed by authoritarian regimes, while she has been living in Brussels without any accusations of unlawful activities. Her work is perfectly legal.
“Kazakhstan needs only three to five minutes to freeze a bank account,” Kozlovska added.
Because of this, she and ODF rely heavily on bitcoin, which lets them transact and fundraise permissionlessly. If all bitcoin/crypto wallets require personally identifying information to be tied to them, such as may be the case if the Digital Asset Anti-Money Laundering Act of 2023 (DAAMLA) passes into law, then even people based in liberal, democratic jurisdictions may find themselves remotely impacted by authoritarian rules. Even worse, activists living under those authoritarian regimes may be targeted if they use bitcoin or any other type of borderless money.
The financial regulations from the United States and European Union tend to be adopted globally as the “gold standard,” as Kozlovska puts it. She is now focusing on educating politicians and regulators in the U.S. and EU about what is at stake if they do not consider the anonymity that bitcoin or other crypto assets like the U.S. dollar stablecoin Tether USDT 0.0% USDT 0.0% (USDT) provide to those with no other financial recourse.
The Blockchain Association, a trade group that represents the crypto industry in Washington, D.C., has also expressed concern over DAAMLA. CEO of the Blockchain Association Kristin Smith penned a letter to Senator Elizabeth Warren (D-Mass.), who sponsored the bill, in which she stated that “blockchain technology has demonstrated the potential to enhance financial inclusion” and that “crypto technology reflects and enhances fundamental values integral to our country.”
The stories of Lyudmyla Kozlovska and Win Ko Ko Aung provide evidence that blockchain technology is in fact a tool for financial inclusion. Bitcoin and crypto assets have been a financial lifeline Kozlovska and Win Ko Ko Aung. And both of these pro-democracy activists continue to use crypto technology to support other activists like them around the world, those fighting for values that we consider fundamental in the United States.