Oslo Conference Scrutinizes CBDCs’ Freedom Risks

Central bank digital currencies (CBDCs) have become a significant concern for the public recently. This sentiment was strongly reflected at the Oslo Freedom Forum last week. The risk of governments misusing their newfound power with CBDCs is especially alarming for individuals advocating for freedom in authoritarian regimes.

The Oslo Freedom Forum, an annual event hosted by the Human Rights Foundation in Oslo, Norway, serves as a platform where human rights activists convene to share their experiences under repressive governments and discuss future actions to promote freedom. During the forum, I spent the first two days educating attendees about the current landscape of CBDCs, leaning on informative pieces crafted by the Human Rights Foundation. The reaction was one of surprise and concern, with many, including activists, government officials, and citizens, admitting they were unaware of their governments’ involvement with CBDCs.

This lack of public awareness is troubling. Throughout the forum, the narratives from countries such as Russia and Nicaragua highlighted how regimes exploit financial systems to suppress opposition. Carlos Chamorro from Nicaragua, for instance, was branded stateless and a traitor by his government, leading to the confiscation of his pension, home, and assets simply because he criticized Daniel Ortega’s dictatorship and established a trustworthy news organization.

Similarly, in Hong Kong, Jimmy Lai faces potential life imprisonment for similar accusations. Like Chamorro, Lai openly criticized those in power and founded a newspaper to support democratic movements. In response, the Hong Kong government froze financial accounts and seized assets to stifle dissent among pro-democracy activists, illustrating the severe financial retaliation by repressive regimes.

Alexei Navalny’s case in Russia further underscores this tactic. Navalny, a vocal critic of Vladimir Putin through his Anti-Corruption Foundation, experienced severe government backlash. The foundation’s accounts were frozen preemptively, and the government extended its crackdown to individual employees and their associates. Navalny’s death this year in a Russian labor camp exemplifies the fatal consequences of such suppression.

With these examples in mind, the profound concern over CBDCs becomes comprehensible. These digital currencies present potential for governments to heighten their control over the financial system, thereby expanding their means of oppression. On the third day of the forum, I had the opportunity to delve deeper into these concerns and participate in discussions with Charlene Fadirepo and Roger Huang, who have both penned comprehensive works on the implementation of CBDCs in Nigeria and China.

Fadirepo and Huang highlighted a common theme of government inefficiency in rolling out these currencies. In Nigeria, the CBDC’s initial release was marred by issues, earning it a questionable reputation. Similarly, in China, the transition of central banks into tech companies has been plagued by significant challenges, leading to widespread criticism and even resistance among government employees.

This inefficiency could be a double-edged sword. Huang warned that in an attempt to overcome their technical shortcomings, governments might resort to coercive measures. In Nigeria, for instance, the government orchestrated a cash shortage to force the adoption of the CBDC, which then-Central Bank of Nigeria Governor Godwin Emefiele hailed as a success. Such drastic measures reflect the lengths to which governments might go to ensure the acceptance and control of CBDCs.

The implications of widespread CBDC adoption are profound, particularly for those fighting for human rights. The words of Nobel Peace Prize laureate Liu Xiaobo resonate deeply here: if the government controls one’s finances, dissent becomes nearly impossible. This notion was echoed by Huang during the panel, emphasizing that controlling income would effectively silence opposition.

Seth for Privacy summed it up well during the discussion, stating that the overriding takeaway from the Oslo Freedom Forum is the realization that protests, activism, and dissent are significantly hindered when governments have total control over citizens’ money. The forum’s environment is a stark reminder of the challenges and responsibilities faced by individuals fighting for freedom.

In this context, the importance of raising awareness about CBDCs cannot be overstated. Most people lack understanding of what CBDCs are, let alone their potential risks. Therefore, one of the most crucial steps in countering this threat is to ensure that the public is informed and engaged in the conversation about the dangers posed by government-controlled digital currencies.