The Breakdown - Alex Gladstein on Why Human Rights Activists Don’t Care About the Price of Bitcoin

Starting point is 00:00:00 Morally speaking, doesn't it make sense that everybody should have access to the best fiat if we're going to be in the fiat standard? Like, why should you have to use some crappy fiat that your government produces that goes to zero and that is extremely hard to use abroad? Tether, USDC, they make this possible. Like, there are people in Lebanon who are taking cash that they've earned in their collapsing currency and they go to a broker and they give the cash to the broker and they receive tether on their phone and they have U.S. dollars.

Starting point is 00:00:24 There's no other way for them to get U.S. dollars. Same thing in Iran, Venezuela, Turkey, Argentina. that, like, this is a global, global phenomenon. Welcome back to The Breakdown with me, NLW. It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. The breakdown is sponsored by nexo.io, near NFTX, and produced and distributed by CoinDesk. What's going on, guys? It is Tuesday, June 28th, and today I am thrilled to be joined once again by Alex Gladstein. Before we dive into this conversation, one quick housekeeping note.

Starting point is 00:01:01 There are two ways to listen to the Breakdown podcast. You can find the show on the Coin Desk Podcast Network, which comes out every afternoon and features not only the Breakdown but other great CoinDesk shows, or you can listen on the Breakdown Only feed, which comes out a few hours later in the evenings. Wherever you listen, if you're enjoying the show, I would so appreciate you taking a moment to leave a little review. This is one of the ways that the podcast apps know to recommend the show and help bring new people into the community,

Starting point is 00:01:28 and I really appreciate all of you who have taken the time to do so. Lastly, a disclosure, as always, in addition to them being a sponsor of the show, I also work with FTX. So today, as I mentioned, I am joined once again by Alex Gladstein. Many of you know Alex as the chief strategy officer of the Human Rights Foundation

Starting point is 00:01:45 and one of the most articulate people out there on helping us understand the relevance of Bitcoin for human rights activists around the world. Given that we are in this bare market and might be here for a while, I thought it would be good to check in on whether Bitcoin is somehow less relevant or less useful for those activists now that the number has gone down. I think what you'll see from this conversation is that as it turns out, the number going up or down matters a lot less to the people who need Bitcoin most than some of its other

Starting point is 00:02:15 properties. All right, Alex, welcome back to the breakdown. How are you doing, sir? Great. It's nice to be back on the breakdown. Yeah, so it's been a little bit of the breakdown. Yeah, so it's been a little while, and I thought it was fun. You know, you and I were just talking. And there are things that are great about number go up periods. It's sort of a vehicle for pulling new people into the Bitcoin world and giving them a chance to start exploring.

Starting point is 00:02:38 But the flip side is also true in the sense that there are a lot of really nice things about moments where the hype cycle dies down and we can actually kind of reflect on what we think is important about this technology and about Bitcoin as an asset. And so what I want to do today is kind of just catch up with you around the world of human rights and Bitcoin. I mean, obviously that has, you know, that doesn't stop regardless of market cycle. And so I think it'd be great to just kind of check in on a few things. And so what I wanted to do is maybe just like, let's go to the Oslo Freedom Forum. And if you could tell us a little bit about what that is, where it came from and kind of, you know, what the big themes were this year, not just Bitcoin,

Starting point is 00:03:17 but kind of, you know, broadly speaking. Yeah. And I think one of the last times I was on here was in January of 2021 and we sat down with Ben Hunt and we had a conversation about Wall Street and Bitcoin and who's going to win and that was very much at the on the roller coaster up moment. We were all riveted by what was happening at the time in terms of the price going in a particular direction. Now it's the total opposite, but at the end of the day, the human rights utility of Bitcoin remains the exact same. Like it doesn't matter whether it's 15K, 20K,000k, 60K, 5K, the network does what activists want it to do. And that was very apparent at the Oslo Freedom Forum.

Starting point is 00:03:55 The Freedom Forum is the flagship event of the Human Rights Foundation, which is a nonprofit that I've been working at for 15 years this month, actually. It is a organization that focuses on promoting civil liberties under authoritarian regimes worldwide. So by our numbers, 53% of the world, that's about 4.3 billion people live under an authoritarian regime, where there's no real separation of powers where human rights organizations are either completely illegal or, like, heavily restricted. where there's no free speech, no free and fair elections, et cetera, et cetera, et cetera. So, you know, we often complain, rightfully so, about flaws in our, maybe our own countries, if we live in America or Germany or Japan or whatever. And we should, and we have mechanisms for that, and we can throw our leaders and sue them.

Starting point is 00:04:42 And, you know, I can, you can take them to the Supreme Court, and you can make fun of them and get paid very well doing so. You can get paid millions of dollars to make fun of the present in the United States on late-night TV. But for people in Cuba, Saudi Arabia, Russia, China, obviously they can't do that. If they publicly criticize their government in many of these countries, it's immediate jail or worse. Prison camp, for example, if you're a Uyghur in China. So our mission with the Oslo Freedom Forum was to create a global gathering point in the style of a TED or a Davos or what used to be the Clinton Global Initiative. You know, all these events were like highlight events for the world's

Starting point is 00:05:20 influential with regard to, in the case of TED, technology and design, in the case of Davos finance, and in the case of the Clinton Global Initiative, it was development. We were like, well, where's the freedom and human rights one? It didn't exist. The only human rights conference that was at that scale was the one run by governments and dictators called the UN General Assembly, which gathered every September in New York. And it was always just like a, you know, a rogues gallery of like, you know, Assad and Gaddafi and Putin. And we were like, this is ridiculous. Let's Let's create a conference that empowers activists, sort of the reverse Davos, puts them on the stage, and then we'll have the wealthy and influential sit in the audience. So that's what the Thousel of Freedom Forum is.

Starting point is 00:06:00 This was the 14th annual event. And there was definitely an infusion of the Bitcoin community there. I think the goal has been to, over time, introduce the concepts of financial freedom, mainly because the activists need it. But there was kind of like a dual agenda there. Since 2017, that was our first kind of Bitcoin workshop at the Oslo Freedom Forum. So five years ago, each year since then, we've been adding a little bit more. And the goal is really to do two things. Number one, to help engage the Bitcoin leaders and influencers with the global,

Starting point is 00:06:36 broader political struggle for freedom. And that I thought was very successful. And then the other piece is, of course, to put at the disposal of the world's most important activists, the world's best educators about Bitcoin so that they can learn how to incorporate it logistically and administratively into their work. So let's say they need to make a payment to a colleague back home who's in an authoritarian country. Well, you can't use the banking system for that. So, you know, you talk to every prominent activist from one of these countries. They all have money issues. And Bitcoin and to another extent, stable coins can be very helpful there. So we

Starting point is 00:07:11 had a big program about that. We also educated the Norwegian government. I brought a bunch of Bitcoin users and leaders from countries like Ukraine, Venezuela, Nigeria, Afghanistan. We went to parliament and we told the Norwegian government why Bitcoin matters for human rights. And I think they were very impressed. They hadn't even really thought about it before. We also talked about energy, which is a big deal over there, even though the country has a 100% renewable grid. They were debating, banning proof of work.

Starting point is 00:07:42 But I had Nick Carter and Linaldon with me and they were able to. to break down why that was a bad idea and why you can't just replace proof of work with proof of stake. So that's what we were doing over there. We also did some like pow-wows, some leadership sessions between activists and Bitcoiners. It was great. And I intend to do it again next June. Do you find when you kind of go into that type of setting that people are surprised, like,

Starting point is 00:08:12 is the average case that you find folks who, who maybe seem contentious to Bitcoin to the outside to be more open and receptive, or is it totally kind of subjective? You're talking kind of about proof of work. Is it just an education thing? I guess it's another way of asking the question. So activists from authoritarian regimes are very open and curious. And that's really the goal is to meet them where they are,

Starting point is 00:08:33 understand their financial problems. They have frozen bank accounts. They have collapsing currencies. They can't connect to fintech that we can use. They are being monitored and surveilled when it comes to their bank accounts. and just showing them that there's an alternative, a plan B that they can use. And they get very excited about that. And there's not a huge amount of skepticism.

Starting point is 00:08:54 I mean, this is built for them. On the other hand, there are, of course, a lot of people at the events we throw who are not activists from authoritarian countries. They might be the mainstream media. They might be policymakers, investors, whatever. Yeah, they tend to be skeptical. They're like, why, you know, why is all this Bitcoin programming here? So we'll see.

Starting point is 00:09:11 We'll try to keep it at a balance. And we'll try to make it so that, any of the financial freedom or Bitcoin programming is sort of you choose, mainly you choose to go to it. And if you don't want it, if it's not interesting to you, there'll be other stuff happening. But in general, I mean, 95% of the content at the Oslo Freedom Forum is not related to this topic. But it's just an important thing that we want to be there alongside general digital privacy. So we also, for example, we had Citizen Lab there, this Canadian watchdog. And they were checking people's phones to see if they had Pegasus on them, which was fascinating.

Starting point is 00:09:44 Like I was sitting there, it takes five minutes. They basically export a file off your iPhone or Android. And then they sit there on their computer and they run like a scan on it. And they can tell you whether you have Pegasus. And of course, if you have Pegasus on your phone, this spyware made by NSO group, everything on your phone is compromised. Everything in signal. Nothing is safe.

Starting point is 00:10:03 So you're sitting there waiting and it's like a medical prognosis. You're like sweating bullets. Like I hope to God, I don't know Pegasus. So I was all good. But there were four activists who had Pegasus on their phones. we discovered this at the forum, including two from Rwanda. So the Rwandan dictatorship led by Paul Kagame basically spends millions of dollars tracking people who criticize him abroad using this software. So to the Saudis.

Starting point is 00:10:26 Obviously, that's how they got Bezos, if you remember. So a lot of these dictatorships used the spyware. The Salvadorans were doing it. Bukele was doing it to the journalist in his country. And we also had a investigative journalist from El Salvadoran, and he talked about why. He felt it wasn't working to impose Bitcoin on a population. So that was an important and interesting perspective we had as well. Nexo lets you easily buy crypto with your bank card and earn industry leading interest rates.

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Starting point is 00:11:44 Business, creativity, and community are being reimagined for a more sustainable and inclusive future. Reimagined your world today at neer.org. The breakdown is sponsored by FTXUS. FtXUS is the safe, regulated way to buy and sell Bitcoin and other digital assets, with up to 85% lower fees than competitors. There are no fixed minimum fees, no ACH transaction fees, and no withdrawal fees. one of the largest exchanges in the U.S. FDXUS is also the only leading exchange that supports both Ethereum and Solana NFTs. When you trade NFTs on FTCX, you pay no gas fees. Download the FTX app today and use referral code breakdown to support the show. I think one of the things that's important about this too is sort of this situating Bitcoin in the context of a larger kind of struggle. So, you know, I've kind of been in and around. a variety of different areas of sort of call it impact work since I was in college. And one of the really challenging things, which I mean, you live in every day is when it comes to human rights

Starting point is 00:12:58 specifically, is that on the one hand, you have, you know, kind of big schools of philanthropy and charity that don't deal with it at all, right? Because it involves subjective decisions. It is not sort of malaria nets or whatever, right? And it's not, not obviously to, to diminish the importance of malaria nets or anything like that. But there's this whole big categories of funding groups and potential allies that won't touch human rights. Then on the other hand, you have kind of like the political circles who also often won't touch human rights activism because, again, it involves making subjective judgments. It doesn't fall in easy sort of partisan lines that are clear. And so it really does become sort of this thing that is so fundamental, but that also has to

Starting point is 00:13:41 kind of fight, you know, for its place relative to all of these other kind of going concerns that consume people's attention. Yeah, I mean, it's definitely two different camps, often talking past each other. But I'm feeling a lot is clicking into place in this cycle. Every time you have a cycle, you get a little more adoption, you get a little more education, the movement grows. Look, every day, more people join Bitcoin. It's not going in the other direction, you know, regardless of the price.

Starting point is 00:14:09 The rate of change may slow a little bit during these times, but it often lags behind the price, just like, the hash rate. Like I often find this just going back two or three cycles that I've seen. Interest often follows the bubble. So I got a lot of interest after the 2017 bubble, for example. In 2018, I spent a lot of time talking to people about this. So I'm feeling sort of the same thing now. I mean, for me, really, I think in many ways, the top of the bubble was in last, was 400 days. It was more than 400 days ago. It was last April. If you look at the value of Bitcoin. adjusted for inflation. The peak was the first peak in April. So it's really, we've, you know,

Starting point is 00:14:51 more or less been in a bare market ever since then, if you look at a particular perspective. And yet, like, we still are getting a lot of interest. So I'm doing some pretty exciting sessions with policymakers and really, really big NGOs in the coming month to help them understand Bitcoin. And at the end of the day, like, they may end up adopting it internally for administrative uses. They may not necessarily go out and promote it. But they're going to need to use it. I mean, look, anyone who's got an international business where they're paying people in different countries and who's at all open-minded about being empathetic about, you know, working better for their employees, you know, is going to use Bitcoin. I mean, it's just easier. Like,

Starting point is 00:15:32 if you need to pay somebody in Russia or in Palestine or in Cuba or in Nigeria or wherever, it's just way easier to use Bitcoin than to use the legacy financial system. And now we have all these apps and companies that are sprouting up on both in Nigeria, for example, and in America that make it easy to use Fiat to connect to Bitcoin or vice versa. So for example, you can use strike in America to pay a lightning invoice. You can use your debit card, you know, and on the other end, in Nigeria, you can use Send Cash, which is a Nigerian app, and your family can send you Bitcoin from America, and it deposits as Naira in your account. And both of these things can happen, like, instantly. So you're starting to see a lot of these apps.

Starting point is 00:16:13 that bridge the two worlds and that make it a lot easier for people. So I think you're going to see just like a ton of adoption on the sort of internal administrative logistical front for different activist groups and NGOs, you know, in the coming year or two. And then, you know, during the next cycle, it'll just, it'll just, you know, we'll go to the next level. Yeah, I find this as well. I think that actually the people who choose to stick around as a cycle kind of closes

Starting point is 00:16:40 and it sort of slouches into whatever type of winter. it's going to be, tend to be super highly engaged, right? They kind of like come through this gauntlet of, you know, they find themselves still interested even after that kind of initial excitement wears off. And I think they end up becoming some of the most sort of like vocal active, you know, kind of building types to follow. Another question coming, coming off of what you were just discussing, though, that there's been some chatter about recently is kind of where stable coins fit in the sort of ecosystem for these sort of human rights activists as well? Because there's kind of different functionality, and not just for activists, but for people kind of living

Starting point is 00:17:20 inside these sort of unstable monetary regimes. How do you kind of describe where those sort of lines are drawn and how people use Bitcoin and stable coins differently in different contexts? For me, I've had to change my mind on this a lot in the last few years. Like three, four years ago, I was like, stable coins are stupid. I couldn't figure out a reason. And you talked to a lot of very educated and open-minded Bitcoin developers and engineers. And they'll tell you the same thing. They were like people who you might even be surprised by were like, yeah, I thought they were not useful.

Starting point is 00:17:56 And I just remember Nick Carter being like, no, no, no, they're useful, blah, blah, blah. And he kept telling me. And I was like, all right, all right. And then I finally saw what he was getting at. He was sort of very ahead of the curve on this one and understanding their role. in the financial system and the global financial system, because I just kept seeing it come up in my work, I just kept seeing when I was interviewing people in different countries,

Starting point is 00:18:17 they would keep telling me about tether and how they use it alongside or in addition to or even separately from Bitcoin. You know, it should be obvious or apparent to anybody now that as like a short to medium term money, Bitcoin is too volatile for a lot of people. I mean, obviously look just what's happened in the last six months. Now you could say, well, it was the other way around. if you cherry pick a different time, but that doesn't matter in the end. The point is that a lot of people end up using Bitcoin as a bridge between money.

Starting point is 00:18:45 You can use it to move value from A to B, and you can use it to save for the long term. Those are kind of its two shining use cases right now. Over several years, it will increase purchasing power for its users, which is amazing for people who are stuck in regimes that don't have access to the S&P 500 or to tech stocks or to have enough capital to have real estate. I mean, a lot of people are saving in like cows or sheet metal or cinder blocks. So to be able to have Bitcoin as a savings instrument's incredible innovation. And then also as a payment network, just this ability to send a small payment instantly to anywhere in the world to anyone who can just download a Bitcoin wallet is also amazing.

Starting point is 00:19:23 But like when it comes to like short term holdings, yeah, you're seeing a lot of demand for dollars. And I think what learning about stable coins and learning about monetary history taught me is that we're very privileged to have the dollar. And as long as we live in the Fiat standard and we're. We're still in the Fiat standard today. It might be in the decline, but we're in it for sure. And, you know, morally speaking, doesn't it make sense that everybody should have access to the best Fiat if we're going to be in the Fiat standard? Like, why should you have to use some crappy fiat that your government produces that

Starting point is 00:19:51 goes to zero and that that is extremely hard to use abroad? Like, why should you have to use a colonial currency, et cetera, et cetera? Everybody should have access to the dollar for the meantime is like kind of my new view. And, you know, what's interesting is that Tether, USDC, they make this possible. Like there are people in Lebanon who are taking cash that they've earned in their collapsing currency and they go to a broker and they give the cash to the broker and they receive tether on their phone and they have U.S. dollars. There's no other way for them to get U.S. dollars. Same thing in Iran, Venezuela, Turkey, Argentina. Like this is a global, global phenomenon.

Starting point is 00:20:22 In Nigeria, the tether volume is way higher than the Bitcoin volume. So tether is the biggest cryptocurrency asset in Nigeria. It's not close. And again, it's because people want dollars and they can't get them any other way. So all this has led me to, you know, appreciate it. that, acknowledge that, understand that. At least these two major stable coins are, and again, they're used for other things, but you can't argue that they're not powerful humanitarian tools right now for people, but they're not like Bitcoin. I mean, we just need to be clear about this.

Starting point is 00:20:49 They're centralized. They're gate kept. They can be frozen. They have massive issue or risk. They really have very little resemblance to Bitcoin in any way, except that they're digital money that are permissionless, essentially. Like, you don't need ID to get it. But there's a lot of failings. So the real question for me, and I think the question now for a lot of different Bitcoiners is how can we enable or empower Bitcoin users to have exposure to the U.S. dollar? Like if I send you Bitcoin and you're, whether you're in Palestine or Pakistan or whatever, and you've just received the Bitcoin in an open source wallet that's non-KYC that you've just downloaded, how can you then get exposure to the dollar? Is there a way to leverage

Starting point is 00:21:25 the Lightning Network to go into a contract for difference? Can you receive, can you trade the Bitcoin over lightning for Tether. These are just questions that people are asking. Can you do this through Fediments, which is a fascinating new project that I'm looking into quite deeply, which is essentially the idea of like a community bank, basically a federated custodial arrangement where you send them some Bitcoin and then you join like a community bank and you have e-cash and you can maybe denominate that in dollars if you wish. There are a lot of solutions Bitcoiners are now playing with, which I'm really excited about because this just wasn't really a kind of. conversation like 18 months ago. And now it seems that a lot of the big teams, a lot of the big

Starting point is 00:22:06 companies in Bitcoin, whether it blockstream or Lightning Labs, et cetera, are investing in or supporting efforts to get Bitcoiners access to the dollar. And I think that's just so important for the rest of us. I mean, for those of us who just earn our fiat income, save into Bitcoin, we're very privileged. I mean, that's a dream scenario, obviously. But for a lot of people around the world, they don't earn fiat income in dollars. They earn it in some horrible currency. and they're not anywhere near as fortunate as us. So for them, I think we should also try to see if we can get them dollar access. So that's something I've had to change my mind on, yeah.

Starting point is 00:22:41 I think it's super interesting. I mean, this is one of the things that I'm most excited about in a quieter period where people are reevaluating what they want to spend their time working on. I think the set of people building on Bitcoin exploring this kind of being, coming at this type of question from the standpoint of the lived experience of people that they're trying to sort of serve with products versus just whatever. whatever kind of the perception was before they examined that, I think is a really positive development. As we wrap up here, what are you most excited about going into this next period of Bitcoin's

Starting point is 00:23:12 evolution? Yeah, well, look, I don't want to go too crazy about the stable coins. The goal is still to replace the dollar system with Bitcoin. But just to be realistic, we're going to be in the fiat system for a while. And in the meantime, I think it is going to be important to help Bitcoin users get dollars. What am I excited about? UX improvements? I mean, I think in the biggest way, kind of unlike in other crypto asset systems, the biggest stumbling block for Bitcoin is UX in education. It works. Like, it works really well. Like if you just need to move money around or save money, the moon wallet, for example, out of many is beautiful, elegant, works extremely well, is going to be good for you. And there's so many different wallets out there that meet your

Starting point is 00:23:56 needs, whether it's the sparrow wallet or the blue wallet or the green wallet or whatever, like it's good enough. But I mean, just think about what we can achieve if there's more functionalities in the average Bitcoin wallet. Like send and receive has changed the world, right? But what if you could have send, receive, buy dollars, earn interest, borrow against your Bitcoin peg into an anonymous e-cash system? I think these are all functionalities that may be available to the average Bitcoin wallet user

Starting point is 00:24:25 in, let's say, two to three years from now. So I think expanding the flexibility and possibilities for the average Bitcoin user around the world and giving them really, we talk about defy. I mean, giving them more of a defy experience, I think is going to be really interesting. So that's kind of what I'm most excited about. Amazing. Well, we're going to have to do this again more quickly than 15 months or whatever it took us in between to come back and check in on how some of those things are doing.

Starting point is 00:24:53 But in the meantime, I always love having you on. Great to hear your kind of, I find that the people who are kind of spending the most time with those who are actually fighting the important battles tend to, in spite of themselves, be the most optimistic. So appreciate what you do and appreciate the time today. Thanks for having me on. All right, cheers. I always love having Alex's insights into these types of topics and issues.

Starting point is 00:25:17 But one of the things that I enjoy most is his ability to understand things from the perspective of the real world. We talk often about the crypto industry being disconnected from real-world users or use cases, but Alex spends his life with activists who have actually used Bitcoin, and in some cases, as you heard, stablecoins, as a tool to overcome monetary oppression. I think it behooves us to ask how we can build better tooling and better systems for this set of people who represent such a large portion of the world's population. If you enjoy this conversation, definitely go check out at GladSene on Twitter for a window into

Starting point is 00:25:52 all of Alex's and the Human Rights Foundation's work. For now, I want to say thanks again to my sponsors, nexo.io, near and FTX. And thanks to you guys for listening. Until tomorrow, be safe and take care of each other. Peace.

The Breakdown - Alex Gladstein on Why Human Rights Activists Don’t Care About the Price of Bitcoin

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