Cryptocurrency, a real buzzword of recent years, has taken off as a means of decentralizing financial systems.
Generally seen as an alternative to the static, radial network of the existing system – with reserve or central banks at the core and a range of multinational commercial banks acting as conduits to the market – crypto is also seen as a tool of dissent. This provokes inevitable reactions from the authorities.
Cryptocurrency strategies were tested and refined at the Freedom Convoy event in Ottawa, Canada. Even though the protest is dormant and the streets of Ottawa are cleared of trucks, the use of crypto as a fundraising tool (and the pushback from legal and government authorities) seems set to define how protest movements popular protest will take shape in the future.
The large rallies against Canada’s Covid regulations seen in the nation’s capital in January and February were bolstered by crypto fundraising. The freedom convoy raised some CAD 10 million on the GoFundMe fundraising channel, before the campaign was taken down by the platform. A important part of these donations were in the form of cryptocurrency, such as Bitcoin.
The Canadian government sought and received a court injunction to freeze these assets in order to stifle protesters.
Currencies like Bitcoin use a system of multiple ledgers on a blockchain. While all transactions can theoretically be traced by anyone in the network, it is almost impossible to access real accounts without the chain-specific identification key. This is known only to the owner and no one else.
As such, a blockchain account generally cannot be closed or accessed in any way. Because it is a decentralized network, there is virtually no hub or central organization capable of doing this. There is no single body that oversees or controls the accounts.
GoFundMe fell back on its policies in an attempt to defuse the political implications, arguing that the account was shut down because its ownership was unclear.
But the Canadian government has sought to double down and pressure crypto trading platforms to shut down all trades. In mid-February, the Trudeau administration announced that it had adopted 253 bitcoin addresses on cryptocurrency platforms, with a view to blocking them from their owners.
But, it is still unclear how this was to be done or if it was actually done and the government later said it would unfreeze all accounts. We may never know.
One crypto platform, Nunchuck, said it couldn’t close blockchain accounts because it couldn’t access them. Supplier ridiculed the government’s strategy, suggesting lawmakers find out how crypto really works, adding, “When the Canadian dollar becomes worthless, we’ll be here to serve you too.”
It is clear that crypto continues to erode the existing banking structure and will increasingly be used as a fundraising tool for civil protest movements. It appears that the test case provided by the Ottawa protest has not been advanced and the extent to which central authorities can effectively block personal crypto accounts remains a moot point. A real test case remains to be enacted.
Nunchuck’s “epic” answer has a ring of academic prank on it, but it also hints at reliance on the blockchain system to circumvent standard financial structures.
Since the global financial crisis of 2008, the globalized, privatized and economically liberal system that underpins the economic, social and political life of most of us is under threat. While few were called to account for this debacle at the time, the result of the crisis was a series of protest movements in different countries, beginning in Zuccotti Park in New York with the Occupy movement before s extend to hundreds of countries.
While many of these outbreaks have specific sources, such as police brutality or public transport prices, others have morphed into broader criticism of a system that doesn’t work for most people – like this was exposed in 2008-2009.
Government Covid responses and anti-war protests following the Russian invasion of Ukraine indicate that many remain in the mood to protest, continuing a more or less linear momentum from 2008.
Canada may have been the first large-scale use of cryptocurrency as a fundraising mechanism for civil movements and it is unclear to what extent authorities could have circumvented its use had the convoy remained.
What is clear, underlined now by questions about the value of sanctions against Russiais that the increased use of new forms of financial transactions like blockchain will play a more central political role in the years to come.
James Rose is an author, journalist and analyst in media and communications and an academic tutor in media and journalism.
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