I am often rude about how utterly predictable financial criminals are in what they choose to buy – large watches, gold-spattered handbags, ugly yachts, etc – so I want to give a very small amount of credit to Su Binghai, a money launderer with an imagination. Okay, so he bought nine apartments in London, spending about $21 million just a week after he evaded police in Singapore. And, sure, he abandoned a collection of supercars in Singapore, all of which is tremendously dull. But then among the assets seized by Britain’s National Crime Agency (NCA) were “dinosaur remains, between 145 million and 157 million years old… of a mother and baby Allosaurus, as well as a Stegosaurus.” Dinosaurs! Aren’t they gorgeous? So much more beautiful than a boring old car.

The extinct mega-beasts were sold at a Christie’s auction last year for around $15 million, but are now in a warehouse, presumably ready to be resold, (unless the NCA plans to keep them. I can see the appeal of having something so magnificent as a dinosaur skeleton as a centrepiece in your house, although I do worry a little about the amount of dusting required, which may be why other money launderers have not invested in fossils. “I doubt that any of us will be dealing with one of these again,” said Judge Gavin Mansfield during the hearing. What a shame.

The value of the properties and fossils is a tiny fraction of the amount already recovered in Singapore in this case, which is said to have involved more than $3 billion, though it is troubling that many of the fugitives involved appear to have won effective immunity from prosecution in return for surrendering their assets.

Which cryptocurrency was involved in the scheme, I hear you ask? Well, funnily enough, it was Tether’s USDT like it always seems to be. Involvement in multiple scams has not been holding Tether back. Quite the reverse; in the first nine months of the year, it made $10 billion in profits, and expects to make $15 billion in 2025 as a whole. If Tether is not the most profitable company per employee in the world (it employs about 200 people), I’d like to know what is.

One of the few people who appears not to have been using Tether to hide illicit wealth was the former EU Justice Commissioner Didier Reynders. Though maybe he should have been. Reynders was recently charged with money laundering in Belgium in perhaps the strangest scheme I’ve read about this year. Reynders spent nearly $60,000 on lottery tickets in a single year.

Now, lotteries have been used by financial criminals for a long time. My favourite money laundering approach ever was one used in Puerto Rico in the 1980s when criminals would buy lottery tickets at a premium in cash, then (unconvincingly) explain to the authorities that their wealth was simply the result of weekly outbreaks of good fortune.

According to investigators, however, Reynders was doing something else. He was spending unusual amounts on lottery tickets and keeping the winnings. Why is this strange? Unlike gambling in a casino, lotteries are not a good way to launder money, because they distribute as prizes less than two thirds of what people spend on tickets, so you lose a huge amount on the trade. It’s really not very clever and, clearly, the unusual spending pattern raises the authorities’ suspicions. Reynders denies laundering money, and says he was just using private wealth. Whatever happened, he has a lot to explain.

The thankless task of crypto regulation

Reynders may not have tried to launder money via crypto, but many financial criminals do. And over in Washington, DC, regulators have got to do the boring-but-important work of figuring out how exactly the new GENIUS act controlling stablecoins will be implemented in practice. So credit to Transparency International U.S. for attempting to bend things in the direction of sanity. “A well-implemented framework can both support responsible innovation and prevent the kinds of corruption and financial crime that erode trust in financial systems and global markets,” it wrote in a letter to the Treasury Department.

Bitcoin prices may have taken a bit of a dip of late (no doubt irritating Donald Trump), but the crypto enthusiasm stoked by the White House shows no sign of abating. Senate Democrats sent a letter to the attorney general after Trump’s pardon of former Binance CEO Changpeng Zhao with a killer final question/essay prompt: “Do you believe President Trump’s substantial business ties to Mr Zhao influenced his decision to issue a pardon? Explain.”

Richard Teng, who now runs Binance, has denied that his company supported Trump’s own (largely moribund) stablecoin USD1 to curry favour with the first family on his predecessor’s behalf. But considering quite how much money the Trumps have made this year (Trump’s net worth has risen by $3 billion, according to Forbes), it seems unlikely they’ll concern themselves overmuch with the rules, let alone the complex, detailed rule-making around the GENIUS act. On the one hand, this leaves the field open for organisations like TI-US to push for good regulations; on the other, Trump will do what he wants, regardless of the regulations.

The Neom debacle

Trump, though, is not yet a law unto himself. Unlike, say, the Saudi royals. I have a slight obsession with Neom, Crown Prince Mohammed bin Salman’s pet development involving a ski resort, a superyacht harbour and The Line, a ludicrous mirrored linear city which a gazillion architects have been designing at a gigundous profit. Anyway, thanks to the FT, we have a deeper dive into this vainglorious horror show than we’ve ever had before.

There are many, many cars in this pile-up: the 30-storey building that would supposedly hang from the top of an arch over the harbour, despite architects warning that it would inevitably fall on everyone’s yachts below; the “hundreds of shuttle cars running back and forth” to pick up the poo because normal sewage systems couldn’t be made to work; the fact no one realised that buying more than half of the world’s steel each year to build Neom would affect steel prices; the airport shuttle envisaged without any room for luggage; the giant pumps required to circulate water in the giant marina; the disaster in store for migratory birds faced with a 500- metre high, 170-km wide mirror and so on and so forth.

“I was in a conversation one day with two physicists, quantum physicists,” says Antoni Vives, then Neom’s chief urban development officer, in a documentary about The Line. “One of them looks at the other and looks at me, and says: ‘you know what, perhaps it’s the time of the poets now. We need poets’.” No, Antoni, we need satirists. Or maybe sedatives.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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Last week I went to Dubai. I didn’t much like it; Dubai feels as if the brief was to build a city but to leave out all the things that make cities good. Then again, I was there for a crypto conference. And my overall impression of that was – if Western sanctions are indeed shutting Russians out of the world economy, someone should tell the Russians.

The free ice cream at the gate was sponsored by a crypto company promising seamless exchanges between roubles and the dollar stablecoin USDT; an exhibitor offered to deliver you cash in an hour when you transferred them some crypto; and the title sponsor was A7A5, fresh from being sanctioned by the European Union, but very much alive, kicking, and cheerfully distributing stickers to people who took a spin on its wheel of fortune.

The centre of the hall was dominated by a crypto-trading competition, in which a number of people sat behind screens and sought to make a profit while against the clock. Despite the best efforts of two fast-talking Russian MCs, as a spectator sport, it had all the charm of watching an HR department finishing up the month’s payroll. Still, the competition drew the biggest crowd simply for the lack of other things going on.

None of the whales that might once have come to a Dubai crypto conference were present, now all the action has spectacularly moved to Washington, DC. Check out this Reuters investigation into how much cash The Trump Organization has made in just the first six months of 2025: “the U.S. president’s family raked in more than $800 million from sales of crypto assets in the first half of 2025 alone”, with “potentially billions more in unrealized ‘on paper’ gains”, mostly from foreign sources.

Those who did make it to Dubai intoned the usual verities about crypto ushering in a new age of liberty, despite the huge contradictions all around them. Particularly bewildering was a panel featuring Vít Jedlička, a Czech libertarian and founder of “start-up nation” Liberland, alongside Nabil Arnous, whose job is to bring investment into “Innovation City”, a newly-renamed AI-powered free trade zone in the absolute monarchy that is Ras Al Khaimah, one of the seven emirates that make up the UAE. The blockchain is powerful indeed if it can unite people from such supposedly opposite political poles.

Even more head-scratching to me though was a presentation by Reeve Collins, who co-founded Tether and was an early advocate of all things crypto, He came to Dubai to pitch his idea for “white label” stablecoins which would allow companies to put their name on a dollar-pegged cryptocurrency while leaving all the hard work of running the blockchain to someone else.

Why might companies want to do that? Because every time they sell something, they get to collect even more data about their clients than they already do, as well as earning profit from issuing money that currently goes to the government. 

“Since this is programmable money, you get real data on all of the users, and you get to understand who are the power-users, who deserves more, who deserves to be rewarded,” Collins said. “This is loyalty points times a thousand. It really will supercharge what companies are able to offer their users, so they'll be able to extract more value.”

I kept expecting someone to speak up and point out how far his vision had strayed from cryptocurrencies as a tool for individual autonomy, rather than a tool that enables the world’s largest corporations to frack humanity even harder than they are now. But no one did. Instead, the conference moved onto a panel about how governments couldn’t be trusted.

At some point the music will stop, and none of us will have chairs, and there will be an almighty blow-up. The prospect slightly terrifies me.

Kyrgyzstan's crypto compulsion

For now, though, the music is very much still playing. Particularly in places like Kyrgyzstan, which seems to be doubling down on its strategy of becoming a ‘cryptatorship’ like El Salvador. Binance founder Changpeng Zhao, the crypto billionaire who pleaded guilty to violating U.S. anti-money laundering laws and was recently pardoned by Trump – though the U.S. president claimed not to know Zhao –  headed to Bishkek to talk up its transformation. “Had a great time in Kyrgyzstan in the past two days. I encourage more crypto companies to explore the country too,” he Xed.

There are already a number of crypto companies in Bishkek, including the sanctioned A7A5, and their close connections with the Kyrgyz government are of great interest to the country’s journalists. However, since Kyrgyzstan’s best investigative outlets – Kloop, Temirov Live and Ayt Ayt Dese -- have just been labelled as extremists, it will be difficult for reporters to bring attention to their findings.

“This is the first time in the history of Kyrgyzstan when media outlets have been labelled extremist,” said Kloop in a statement. “Now it is dangerous to like or share outlets’ material, or to circulate it. That could all be considered support for extremist organisations and the circulation of extremist material.” At least, “watching and reading it is currently safe.”

There used to be something admirable about Kyrgyzstan’s bloody-minded refusal to become a dictatorship like the other republics of Central Asia. Now there is something grotesque about the fact that it is the lure of crypto, a technology supposedly intended to enhance freedoms, that is helping to cement autocracy. The country is holding snap parliamentary elections on November 30. The president’s party, unsurprisingly, is expected to do very well.

Watching Kyrgyzstan heading towards autocracy is a reminder that the only plausible long-term solution to kleptocracy is for rich countries to stop enabling it. If Westerners started living up to their professed values, and made it impossible for crooks to buy property and launder money in the West, it would reduce the appeal of being one. 

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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I read a lot of history books and often find myself wondering about how current events will be interpreted by future historians. I appreciate that some people might see this as an overly optimistic practice (“get real, loser, there won’t even be historians in the future, let alone ones able or willing to objectively interpret the past” etc) but I still find it valuable as a way to create a sense of perspective that can otherwise be hard to find.

So, what will historians make of the latest developments in the United States? On Thursday, the government sanctioned Russia’s two most significant oil companies, in what threatens to be a massive blow to the financial underpinning of a key geopolitical adversary. On Friday, however, the government pardoned Changpeng Zhao, a crypto tycoon who two years ago pleaded guilty to, among many other things, facilitating sanctions busting by Iran, also a key geopolitical adversary.

How do you interpret that contradiction, or the fact that the US government is currently not paying its employees, while spending hundreds of millions of dollars, albeit privately raised, on a new ballroom? This could provide material for a hundred newsletters, and no doubt has already done, but I think there is value in asking whether the sole consistent factor here is inconsistency, and whether that itself is significant.

This is what happens when individual people make decisions without oversight, scrutiny or process and, although there may be some value in rapid decision-making, it also makes it far more likely that the decisions reached will be illogical, inconsistent and corrupt. I have been reading a lot recently about the last time inequality was as high as it is now, which was the time before World War One, a time that Americans call the “Gilded Age” and Brits call the Edwardian period. That too was a time of conflicts, inconsistency and excess, when plutocrats built ludicrous houses for themselves, and awarded themselves vast pay deals, when politicians got assassinated and political movements appeared and disappeared with dizzying speed.

I try to be optimistic, because there’s no sense in being otherwise, but the parallel is worrying. After all, the period before World War I all ended with World War I. If I were a plutocrat, I would be working very hard to steer the horse in another direction, away from disaster, rather than spurring it on ever faster.

RESTITUTION FROM RUSSIA?

But look, like a refugee from a different galaxy, here comes news of what should be the end of the long-running legal challenge brought by shareholders in the ex-oil company Yukos against the Kremlin’s expropriation of their assets. The Kremlin lost, and now the shareholders can seek to claim tens of billions of dollars from state assets worldwide. This saga sort of began 22 years ago when the Russian authorities arrested the country’s richest man, Mikhail Khodorkovsky, prosecuted him, and imposed such vast back tax bills that it could auction off his assets in a process that – funnily enough – was won by a state oil company run by a close ally of Vladimir Putin. It was an early sign of the kind of country Putin was building: kleptocratic, authoritarian, centralised, ruthless, and deeply stupid.

But the real beginning of the story was a decade earlier, when President Boris Yeltsin, attempting to build a different kind of Russia, one which followed international norms, signed the Energy Charter Treaty, an agreement designed to protect foreign investors’ stakes in national oil and gas industries.

The primary shareholders of Yukos were Russian but, like any competent global oligarch, they structured their ownership via multiple offshore entities so – when their company was taken away – they sued. And now, they have won in a process that is a memorial to the 1990s, and the odd alternate reality when globalisation was widely considered a good thing.

Obviously, Russia won’t abide by the judgement on its own territory, but the Yukos shareholders will continue their battles for various assets owned by Russia, such as this plot of land in London and these vodka brand names. “Real justice requires successful enforcement, so we will now focus all our efforts on enforcing against Russian state assets worldwide until every penny of the $65+ billion awards has been paid,” said Tim Osborne, who heads the shareholders’ company, which is called GML.

In that effort, however, he may well have competition. There is 210 billion euros of Russian state money frozen in the European Union, mostly in Belgium, and the EU is inching closer to using it to help Ukraine. The universe in which Russia happily deposited its assets in Western countries now feels like an alternative reality – one that historians will spend a lot of time dissecting.

MAKING CRIMINALS PAY

International arbitration is a tricky game to play, however, or so the owners of P&ID may be feeling. In a complex (and, let’s be honest, rather imaginative) attempt to swipe a lot of Nigeria’s money, this small offshore company obtained a gas processing contract in 2010. Neither side did anything to fulfil the contract, then P&ID sued Nigeria and won a giant compensation award, the size of which has been growing larger still with the interest owed.

It is a case rife with allegations of corruption, professional misconduct and more, and mercifully the  initial judgement in favour of P&ID was overturned. Last week, a court ruled that P&ID will have to pay the vast legal costs in sterling, rather than in naira, which will help Nigeria to avoid missing out on the advantageous exchange rate.

To say P&ID’s British lawyers have questions to answer is to understate how serious the allegations against them are, but regulators have so far done nothing. That is a very bad reflection on Britain’s ongoing facilitation of kleptocracy, and the state of its regulators.

Britain, in common with many other countries, has a very fragmented system of anti-money laundering regulation, so it is potentially good news that the government has proposed to combine many of the existing 23 regulators into “a small number” of bodies. Hopefully, this will mean the regulators are better funded, more motivated, and more willing to anger potentially powerful vested interests by actually investigating financial crime. “It is crucial that existing regulators do not take their foot off the pedal while we await legislation which could risk things getting a lot worse before getting better,” said Sue Hawley, of Spotlight on Corruption.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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A couple of weeks ago I wrote about the U.K.’s seizure of 69,000 bitcoins (that’s worth around $7.7 billion) from a Chinese fraudster, and gave the impression it was a pretty big deal. But then, rather in the manner of Crocodile Dundee and knives, the United States revealed what it was packing.

“The Justice Department’s National Security Division [filed] a civil forfeiture complaint against approximately 127,271 Bitcoin, currently worth approximately $15 billion,” the DoJ announced last week. Now that really is a big deal (it’s not far off the total BP paid to settle charges over the Deepwater Horizon oil spill in the Gulf of Mexico). There can only ever be 21 million bitcoins in existence, so this seizure accounts for more than one in 200 of them.

The seizure was part of a case against Chen Zhi, a Cambodian businessman charged with being behind some of the most appalling forced-labour fraud compounds in Southeast Asia. Every aspect of the alleged scheme, from its targeting of vulnerable people in Western countries, to its reliance on trafficked labourers, is foul on its own but cumulatively, it’s beyond dreadful.

The money laundering techniques were complex and multi-jurisdictional, and the profits were spent on the usual expensive trash: “watches, yachts, private jets, vacation homes, high-end collectables, and rare artwork, including a Picasso painting purchased through an auction house in New York City”.

And of course there were shell companies in the British Virgin Islands and properties in London, because there are always shell companies in the British Virgin Islands and properties in London: a £12 million mansion near Primrose Hill; a £100 million office building in the City; plus various flats in the Centre Point building, and others in Nine Elms, a newly-built neighbourhood where many of the off-plan apartments went to cash purchasers from the Far East. 

(Nine Elms is also, incidentally, home to the new U.S. embassy and a few years ago I did a talk for staffers interested in financial crime and one asked why, if there was so much money being laundered in London, none of it was visible. I drew his attention to the view from the window.)

The U.S. government earlier this year said it will place any bitcoin it seizes into a strategic reserve. I suppose a crypto reserve sort of makes as much sense as a gold reserve, at least until people lose interest in crypto and/or the power goes off. But there is a problem with the basic idea here: these bitcoins don’t belong to the United States. Assuming that the criminal complaints are proven, then this money is the fruit of crimes committed against millions of victims, and should be returned to them, whether in the form of bitcoin or whatever, not stashed away in Washington.

Some commentators have said cryptocurrencies help fight financial crime. In a blog, Elliptic, a blockchain analytics company, argued that “blockchain technology enables comprehensive visibility into financial flows, empowering all ecosystem participants to play a crucial role in identifying and reducing illicit funds.” But I don’t think that’s the message I take from this. 

If the two biggest asset seizures of all time have come one after the other in the form of bitcoin, I think the important question to ask is “why do criminals have so much of their wealth in cryptocurrencies?” If crypto is helping baddies to hide their money more than it’s helping goodies to find it, then it’s more of a problem than it is a solution.

THE PITCAIRN CRYPTO PLAN

Thanks to an Australian reader for tipping me off to an odd situation in the Pitcairn Islands, the only British Overseas Territory (BOT) in the Pacific, and the smallest territory in the world by population. Pitcairn has fewer than 50 inhabitants and is extraordinarily remote so unlike most BOTs – the Cayman Islands, the BVI, Gibraltar, Anguilla, etc – it has never developed an offshore financial services industry.

Anyway, it seems that in January 2020, Justin Sun – the Chinese-born billionaire head of the crypto giant TRON; prime minister of Liberland; first Kittitian in Space; former Grenadian ambassador extraordinary and plenipotentiary to the World Trade Organisation; eater of a $6.24 million banana; and early investor in Donald Trump’s crypto company – explored the possibility of turning Pitcairn into a crypto haven. According to the minutes of the meeting with the island’s council, three of Sun’s representatives were there on a friend-making mission: “TRON is looking to partner with a BOT to work together to craft regulations etc to help make crypto currency more mainstream.” 

There was “a lot of community interest” among the locals for carving up this unexpected cash cow, but fate intervened in the form of a killjoy governor, who represents the U.K. in these parts. “TRON will not be permitted to establish bitcoin/crypto currency”.

According to one academic’s assessment of things, “a company with such a variable track record was never going to be afforded a foothold in the territory.” And, generally speaking, that should have been the end of the matter, leaving us with nothing more than a ghostly alternative timeline in which Pitcairn is a crypto hub (or, perhaps, a 21^st century version of Nauru) and its few-dozen residents are multi-billionaires.

None of this has been confirmed by Tron, so I only have the Pitcairn administration’s documents to go on but it appears that the company did not in fact go away quietly. Instead, in order to “garner favour”, it began to provide solar panels to Pitcairn residents. An attempt by the governor to stop this collapsed, given that everyone really wanted them, and by July 2023, the council’s meeting minutes noted: “we all have solar units donated from TRON on our roofs”.

My Australian interlocutor informs me that Pitcairn residents are unsurprisingly now super-enthusiastic about Tron for having provided them with free electricity, though loath to publicise it. This year Tron advertised for a Project Director (Pitcairn Islands Development) to lead “a humanitarian infrastructure development project aimed at improving the medical and accommodation conditions of 35 indigenous fishermen residing on Pitcairn Island", and is now looking for a “Legal Counsel (Pitcairn Islands Development)”. 

Something’s happening here and I don’t know what it is, but if I worked for the British government I’d be trying to figure it out. Justin Sun’s stated philosophy is underpinned by the libertarian creed of “no forced obligations, no taxes, and no mandates”. It would be a challenging development if, now that he’s provided Pitcairn with free power, he managed to bring the islanders around to that point of view. 

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The Memory That Never Died

I was at a park near where Florida A&M University and Florida State University campuses overlapped in Tallahassee some forty years ago, enjoying the warm air and easy company of friends, when I overheard a white student waxing nostalgic about the Civil War.

“The South should have won,” he said wistfully, as though mourning a missed opportunity rather than a moral catastrophe.

My friends and I exchanged glances. As the outspoken one in the group, I called back, “We beat you last time, and we’ll do it again.”

At the time, I was a sophomore at FAMU, an Historically Black College and University, immersed in African and U.S. history, surrounded by a vibrant, intellectual, Pan-African community that shaped my view of the world.

It was an oasis—an environment where I could think deeply and freely about the past and its implications for the present.

That encounter seemed trivial then, but in hindsight, it revealed something festering beneath the surface of American life: a refusal, especially among some white Americans, to reckon with the legacy of the Civil War.

A Family That Defied the Script

Years later, I would revisit that moment when I went to pick up my daughter at school. She bears the richness of two heritages—mine rooted in Haiti’s resistance, her mother’s Midwestern sensibilities.

Upon seeing me in the courtyard, one of her friends called out that her nanny was here to pick her up. Irritated, she shouted, “That’s my daddy, not my nanny.”

I smiled at her spunkiness. But I also knew that moment crystallized what I had always sensed: our very existence as a family disrupted someone’s idea of what America should look like.

In 1996, I wrote about our marriage for Essence Magazine. The stares. The quiet bewilderment. The feeling that our presence broke an unspoken rule. “Our very existence,” I wrote then, “disrupted someone’s idea of what America should look like.”

It still does.

A Fire Long Smoldering

Four decades after that afternoon in Tallahassee, I’ve come to believe we’re in the midst of the Civil War’s final battle—not a clash of soldiers on a field, but a sociopolitical and cultural war threatening to tear the nation apart.

A fire is roaring through America’s foundations. It didn’t start yesterday. It wasn’t sparked by Black Lives Matter or the 2020 election or any single migrant crossing a border. No—this fire has been smoldering for generations, lit by the unfinished business of the Civil War.

“This is not a war between North and South or red and blue. It’s a war within whiteness itself.”

It’s a reckoning between two factions of white America:
– One trying to build a country where power is shared and history confronted.
– The other desperate to preserve a fantasy where they remain the sole heirs to the republic.

People of color are the excuse, not the cause. The rest of us are just trying not to get burned.

The Arsonists and the Alarm Sounders

January 6 wasn’t just a riot—it was a flare from a deeper blaze.

When white Americans stormed the Capitol waving Confederate flags, Jesus banners, and Trump signs, they weren’t attacking a building. They were rejecting a future that no longer centers them.

They were not fringe. They were family—teachers, cops, veterans, neighbors—willing to overturn democracy to preserve supremacy.

On the other side are white Americans lighting different kinds of fires: truth-telling ones. They’re teaching real history, confronting privilege, tearing down monuments to lies.

But they’re outgunned by grievance—weaponized, monetized, and televised grievance. And nothing in America spreads faster than white grievance wrapped in the flag.

A Fire Fueled by Fear

What drives this isn’t just racism—it’s fear.
Fear of losing centrality.
Fear of becoming “just another demographic.”
Fear that the stories they were told about greatness might be myths.

Equality feels like oppression when you’ve never experienced either.

This fear is tangled with economic despair and a longing for a past that never truly existed. As the promise of American prosperity falters, anger searches for a scapegoat. Immigrants. Black people. Queer youth. Anyone but the systems that failed them.

The refrain becomes familiar: “America is changing too fast.” But the truth is, America is finally starting to look like itself.

Witness From the Margins

I write this not only as a journalist who has covered American democracy for decades, but as a Haitian immigrant who has lived its contradictions.

I arrived as a Black boy with a French accent, navigating the strange hierarchies of race in America. Later, I married a white woman from the Midwest. We raised biracial children in Brooklyn—a borough that celebrates difference in a country that often doesn’t.

For those of us not born here, the message is double-edged: assimilate into a crumbling house, or help rebuild it from the foundation up.

The Currency of Whiteness

For generations, whiteness has been an invisible currency—buying safety, authority, dominance. Now, that currency is losing value. The country is changing its exchange rate.

Some white Americans are hoarding what they can while they can. But people of color aren’t seeking revenge; we’re seeking balance. We don’t want to become what whiteness once was—we want to build something better.

But we can’t rebuild while one faction is holding a flamethrower.

The Front Lines

Go to any school board meeting, and you’ll see it. Parents shouting about “indoctrination,” demanding books be banned, LGBTQ kids erased.
Go to any legislature, and you’ll see laws crafted to silence, restrict, and erase.
Go online, and you’ll find young white men radicalized by digital preachers of hate.

This fire is not spontaneous—it is fed, stoked, and monetized.

Redefining Whiteness

“What does it mean to be white in America without being supreme?”

That’s the question white Americans must face.
Without supremacy, whiteness becomes a blank page. Some see emptiness. Others see possibility.

The hope lies with those writing a new script: one rooted in solidarity, not superiority. But this new identity won’t be born in classrooms—it’ll be forged in discomfort, in truth-telling, in choosing democracy over delusion.

America’s Burning House

America today is a house on fire. The flames were set long ago—some rooms built on slavery, others on exclusion, others on stolen land.

Some white Americans are the arsonists, some the alarm sounders, and the rest of us are tenants wondering whether the fire will reach our floor before the builders arrive.

This is the metaphor of our time: a burning house still under construction. We can let it collapse—or rebuild it stronger and fairer.

The Final Battle

The final battle of the Civil War is here.
Not with bayonets but ballots.
Not with cavalry but algorithms.
Not in Gettysburg but in Georgia, Michigan, Texas—and in living rooms across the country.

And now, with the reins of power once again in his hands, Donald Trump is no longer shouting from the sidelines.
He’s using the full weight of his office to bend democracy to his will—purging dissenters, weaponizing institutions, rewarding loyalty over law.

He has become less a president than an arsonist-in-chief, pouring accelerant on the nation’s divisions and daring America to burn.
Each provocation—each threat, each insult, each abuse of power—is another match flicked at the dry timber of grievance that’s been piling up for generations.

The question now: Will America finally douse the flames—or stand mesmerized as the house collapses around us?

The Memory Returns

Sometimes, I think back to that afternoon in Tallahassee, when a college kid wistfully claimed the South should’ve won.
I wonder where he is now—did he grow out of that fantasy or dig deeper into it?
Is he among those cheering today as Trump fans the flames from inside the house?

I’ll never know. But I do know this: the war he romanticized never ended—it just changed its weapons and its uniforms.
And now, as the smoke thickens and the fire climbs higher, we are all living in the house they built.

Whether it stands or burns will depend on who chooses to rebuild—and who keeps feeding the fire

A version of this article was first published on Garry's Substack and Coda's Sunday Read newsletter. Sign up here.

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It’s always all about the money, and never more so than when talking about cryptocurrencies. They're touted as being about liberation, but really they’re about taking our revenues and redistributing them to billionaires.

Governments have sought to control money distribution ever since there have been governments. There are entire Anglo-Saxon kings (shout out to King Æthelweard) whose names we know only because of coins dug up centuries later by metal detectorists.

It would be nice to think this was because rulers were concerned about spreading prosperity by ensuring a reliable currency, and I’m sure that’s partly true. But the underlying reason has always been that coining/printing money is incredibly profitable. In very crude (and slightly misleading) terms: printing a $100 bill costs around 10 cents; it sells for $100; so that’s $99.90 in profit for the government right there.

Anyway, this was always one of the (if not the only?) interesting things about cryptocurrencies like Bitcoin: by taking the power to issue money away from countries, governments would lose the ability to profit from our need for a means of distribution and exchange, and citizens would gain it for themselves. So it’s not surprising that governments want to stop that happening.

Last week, Uganda became the latest country to launch a Central Bank Digital Currency (CBDC), which will use the same kind of blockchain technology that underpins Bitcoin to create a mobile-first version of the country’s shilling, and thus attempt to negate the appeal of crypto. Perhaps more importantly India, which leads the world in crypto adoption according to some measures, plans to do the same. 

“This will only make it easier to transact. It will also reduce paper consumption and will be faster to transact than the banking system. But it will also have traceability,” said the Indian Commerce and Industry Minister.

For most people in Western countries, the replacement of cash money by CBDCs would make very little difference because the vast majority of transactions are done electronically already; but for criminals, it would be disastrous. Accustomed to being able to use cash in huge quantities to hide their transactions, cartels, traffickers and others would have to invent new ways to find anonymity. (Inevitably, they’ll find it, but it will be more expensive, thus making their crimes less profitable.)

The European Central Bank is moving forward with its own plans to introduce a digital euro, and Piero Cipollone, a member of the ECB’s executive board, gave this fascinating interview last week about what that would look like (I think what he’s describing looks really good, for what it’s worth). A key insight is that, as electronic payment methods have spread, Europeans have become ever-more reliant on foreigners for processing transactions. “It … makes us vulnerable: we depend on others for our money and this can be weaponised against us. Ten years ago we weren’t facing this problem, because cash was king,” he said.

He called the payment processors that dominate transactions “international”, but in reality they’re American. Which brings us to a really interesting exception to the general global movement towards CBDCs: in the U.S., President Donald Trump has ruled the idea out completely, because it would “threaten the stability of the financial system, individual privacy, and the sovereignty of the United States”.

I think concerns about CBDCs’ impact on privacy are very overstated, considering most of us are already giving away ample data about our financial lives to banks, Apple, Paypal, and whomever, for them to do with what they wish, and it is particularly odd that the White House is stopping the Federal Reserve from issuing a digital dollar on privacy grounds while encouraging private companies to do so in the form of stablecoins like Tether’s USDT.

“The difference between a CBDC and a stablecoin like USDT is simple,” said Tether CEO Paolo Ardoino last week. “One belongs to the people. The other belongs to the state.”

That is obviously nonsense. Leaving aside the facile distinction between “people” and “state”, the idea that a digital dollar run by a democratically-overseen Central Bank like the Federal Reserve would somehow be less of the people than one run by a private company based in a foreign country whose president boasts of being a dictator (as El Salvador’s Nayib Bukele has done) is so idiotic it makes my brain hurt.

As so often with Donald Trump’s White House, this is all about the money and who gets it. The profits from issuing currency are called seigniorage, an old French term meaning that which belongs to the seignior or lord. By getting the Fed out of the CBDC business, and instead encouraging private companies to issue stablecoins, the White House is just redirecting seigniorage from the budget towards political allies, such as Trump’s own children. To be honest, I’m sure good old King Æthelweard did the same thing back in ninth century England, but you would have hoped that, 1,200 years later, we might have moved on a bit.

How much money are we talking about? Well, at the end of the month we’ll learn how much Tether made in profit in the third quarter. My money is on it exceeding its already record-breaking $4.9 billion haul from Q2. Its smaller rival Circle meanwhile is predicted to make revenues of more than $6 billion a year by 2028. Any Americans reading this: if the Federal Reserve had issued a CBDC instead of letting private companies do it, that money would be yours for spending on public services. Instead it’s being routed into right-wing media, political donations and the pockets of well-connected billionaires.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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There have been some pretty chunky fines imposed by U.S. authorities for money laundering offences over the years. HSBC paid out $1.9 billion in 2012 for moving cash for Mexican mobsters; Goldman Sachs settled for $2.9 billion after being charged with helping kleptocrats loot a Malaysian sovereign wealth fund; and Danske Bank had to cough up $2 billion for moving vast sums for corrupt ex-Soviet officials.

I mention these amounts to put into perspective quite how ginormous the confiscation order secured last week by London’s Metropolitan Police against Zhimin Qian was. She could have paid all the fines imposed for those iconic acts of financial skulduggery in full, and still have had enough left over to buy the most expensive home ever sold, splash out on the most expensive car ever bought, and have a few millions left over for spending money. Before her wealth was snatched away, her net worth matched that of Donald Trump, who’s done pretty well himself over the last, hmmm, nine months or so.

“Between 2014–2017, Qian orchestrated a large-scale fraud in China through defrauding over 128,000 victims and went on to store the illegally obtained funds in Bitcoin assets,” the Met said. She fled to the U.K., where she was arrested last year, and her devices containing the keys to access her 61,000 bitcoins were seized.

There is a little bit of an asterisk next to the size of the seizure, however, since the bitcoins weren’t worth nearly as much when she bought them with stolen money as they are now. At the end of 2018, the year when the inquiry into her crime was launched, her bitcoins were worth around $228.5 million. That is obviously still by any standards a lot to steal but the cryptocurrency has had a wild ride since then, and her haul is now worth $7.24 billion and counting. 

Qian had promised to triple the investments of the people she defrauded, but she actually increased them thirty-fold by stealing the cash and sticking it in bitcoin.

This episode raises some very interesting issues. What happens to the money? Obviously, her victims should get their money back, but what return should they get: just a standard interest rate, which is better than the nothing they have at the moment; the 300 percent she promised them, which would in ordinary times be awesome; or a proportionate share of this incredibly successful crypto-investment? If I was in the U.K. government, I would be arguing for the first option, but if I was in the Chinese government, I’d be aiming for the last.

Western law enforcement agencies normally struggle to get any kind of cooperation from their Chinese counterparts, but this case appears to be an exception. “Through a meticulous investigation and unprecedented cooperation with Chinese law enforcement, we were able to obtain compelling evidence of the criminal origins of the cryptoassets,” stated Will Lyne, head of the Met’s Economic and Cybercrime Command, which is something I have never heard a senior copper say before.

Could this be the prelude to an unprecedented thawing in relations between the U.K. and China, and the dawning of a new appreciation, nay a respect, for the rule of law in Beijing? Or could it just be that Xi Jinping’s people want a chunk of that $7.24 billion? The jury’s out. And it will remain out until those pesky jurors learn to do what they’re bloody well told.

There are some pretty odd, if compelling, details in this whole affair. “Zhimin Qian dreamt that the Dalai Lama would anoint her a reincarnated goddess,” reported the FT, “and that she would go on to become the Queen of Liberland, an unrecognised micronation on the Danube, where she would build the biggest Buddhist temple in Europe”. Qian travelled to the U.K. with a passport issued by the Caribbean nation of St Kitts and Nevis, which she applied for under the false name of Yadi Zhang.

St Kitts pioneered the whole “citizenship by investment” idea in partnership with Henley & Partners, and has done very well from it, as is abundantly obvious if you visit this extremely beautiful country. It may, however, be time for the rest of the world to start wondering why we are quite so happy to offer its “citizens” visa-free travel if this is the kind of person it sells passports to.

Another citizen of St Kitts and Nevis is the blockchain billionaire Justin Sun, who in August became the first Kittitian to sort of go into space. He travelled just beyond the official boundary on one of Jeff Bezos’ New Shepard rockets, which are so ludicrously appropriate in their phallicness that each trip is almost performance art. 

Sun’s involvement in libertarian fever-dream Liberland, unlike that of fellow Kittitian Zhimin Qian, is no mere fantasy. He has been elected prime minister, and says the microstate “is a manifestation of a political philosophy that champions liberty, minimal government intervention, and individual autonomy”. Sun, notoriously, was one of the attendees at a private dinner hosted by Donald Trump in May for the top investors in his meme coin $TRUMP. The dinner was the culmination of Sun’s transformation from a fraudster charged by the Securities and Exchange Commission to a celebrated business associate of the U.S. president. Sun runs the TRON blockchain, which was home to more than half of all illicit crypto activity last year, according to TRM labs. To be fair, if I was in charge of that kind of business, I suspect that I would be in favour of “minimal government intervention” too. 

The contrast between Sun’s fate and that of Qian couldn’t be more striking. The former, however shady his business dealings, gets to dine at the White House, while the latter is scheduled to be sentenced in a British court next month. If only Qian had invested in Trump’s meme coin?

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I was born in a dictatorship. I saw it fall and did not think I’d see it rise again. 

The dictatorship I was born in – the Soviet Union – was old and senile, much like the succession of its fossilized leaders who would appear at a plenary session one day and drop dead the next. By then, the bankrupt communist system was in its final throes, allegorically lampooned in film and literature while the nomenklatura played a desperate game of whack-a-mole with the ideas of freedom and nationalism that popped up in every corner of the exhausted empire.

Now in my forties, I’m watching a dictatorship return, watching it metastasize across the body of my country, Georgia, and eat away at the precious freedoms gained in the intermission.

“Georgia will never be Belarus,” was our presumptuous little mantra. We Georgians were too rambunctious, too freedom-loving to allow autocracy back in our midst. Since 1991, Georgia has had several  presidents and a dozen prime ministers. The Belarusians have had one bewhiskered man in charge for the last 30 years. Perhaps our post-Soviet peers up north are simply not feisty enough to put up a proper fight. But to put us temperamental southerners under some mustachioed strongman’s thumb? Ooh, we’d like to see you try.

We even chanted this Belarus refrain when we poured into the streets of our capital, Tbilisi, last fall to tell our all-powerful oligarch, Bidzina Ivanishvili, that he does not own our country. We do. Squaring up to riot police, we held up posters and shook our fists, denouncing the oligarch-controlled government’s betrayal of the constitutionally-mandated pathway towards integration with the European Union and, with it, the betrayal of the promise to build a modern democracy.

After many arrests and fractured facial bones, we no longer chant that mantra with the same certitude in our voices. Dozens of young protesters are locked away in prisons, some still showing signs of the brutal beatings they suffered while in custody. Meanwhile surveillance technology, including facial recognition software, has been used to track down demonstrators and drown them in hefty fines.

Courts churn out guilty verdicts robotically and an opposition-free parliament is cranking out repressive laws to choke off dissent. From the prime minister down, Georgian government officials kowtow to Ivanishvili, the oligarch-in-chief and founder of the ruling party, who does not sport a mustache or have a formal position in the government but does own this country.  

IIt is true that Georgia was never a blossoming democracy. My country was indeed institutionally ill-equipped to resist privatization by one (extremely) rich man. But most of us also thought that we were way past the stage when a regress into authoritarianism and isolation was possible. Ironically, it was in fact a democratic breakthrough that brought us to this juncture. 

Thirteen years ago, when the nation’s richest son came down from his futuristic, hilltop castle in Tbilisi to announce his political ambitions, too many were fooled by his promises of freedom and prosperity. Political groups of every hue and stripe joined the army of the discontented that Ivanishvili raised to unseat President Mikheil Saakashvili, a pro-West reformer who caught the autocracy bug toward the end of his rule.

The oligarch’s alliance, Georgian Dream, became an unstoppable juggernaut as it rolled towards parliament, with respectable opposition figures and intellectuals hopping onboard in anticipation of key posts in the prospective new government. The billionaire’s manner suggested that he was not, as Russians are wont to say, exactly scarred with intellect. So his complacent new allies assumed that he did not have the experience, the sophistication, and the vocabulary to run the country on his own or bend it to his will. 

A few Cassandras did offer routine warnings that behind a simpleton’s façade was a tough man with a Machiavellian mind. It shouldn’t have been hard to guess. After all, Ivanishvili managed to make his fortune in the dog-eat-dog world of 1990s Russia and, unlike many from that crop of oligarchs, lived to tell the tale.

Aware of Ivanishvili’s penchant for philanthropy, voters across our cash-strapped nation were overcome by hope that the billionaire’s riches would trickle down to them. He encouraged these expectations. In one campaign stunt, his lieutenants placed glass boxes in the streets, asking passers-by to write their wishes on little cards and put them in the boxes for the wealthy Santa Claus to review at his leisure. Lines quickly formed and the boxes brimmed with Georgian dreams.

Saakashvili, though, was not going down without a fight. But Georgia’s American and European friends took him aside for a lecture on democracy. You can’t be serious about joining the democratic club, they said, without ensuring something as basic as the peaceful transfer of power. Saakashvili accepted defeat. And Ivanishvili took note: maintaining friendships with the West and accepting their rules was problematic to anyone planning to acquire and hold onto power.

The election of 2012 resulted in Georgia’s first-ever democratic transfer of power – previously, revolutions and civil wars were the preferred modes of operation. The country soon came to boast of a highly pluralistic environment. Groups and individuals of all backgrounds and political persuasions filled legislative and executive seats. A cacophonic multitude of media outlets became free to pursue every story and angle.

In contrast to Saakashvili, who shunned critical media, Ivanishvili spoiled us journalists with hours-long, everyone-is-welcome press conferences, where he fielded every question and told awkward jokes. Soon the EU agreed visa-free and customs tax-free deals with Georgia, and the popular desire for membership in the bloc finally seemed within reach. Freedom and democracy were here to stay and there was no going back. 

Fast-forward a decade and you will find journalists and opposition politicians in prison. Critical media, human rights groups and corruption watchdogs are harassed and demonized. Politicians with values and minds of their own are banished from governance, and the Georgian Dream party has been reduced to a featureless monolith of yes-men.

The bid for EU membership is suspended. Georgia’s longtime partners, the EU and U.S., have been shown the door and requested to end their long-running support for democracy-building in Georgia. Moscow, once public enemy number one for Georgia, has become a source of inspiration for repressive ideas and pinches Tbilisi’s cheek in affectionate approval. 

Kremlinesque laws raise the cost of political dissent and threaten to scatter Georgia’s once vibrant civil society – a key driver of democratic change for years. One of the laws that Georgian Dream borrowed from Russia’s playbook requires international donor-sponsored civil-society organizations and media to register as foreign agents – a label that in the local sense primarily connotes a foreign spy – or go to prison.

In a classic authoritarian move for this part of the world, the oligarch’s government styles itself as a guardian of the heterosexual integrity of the nation in the face of gender confusion and sexual incontinence supposedly foisted upon our proud Christian nation by the West. Homophobic laws and rhetoric further demonize and disenfranchise Georgia’s long-suffering LBGTQ community. 

Somewhere in the corridors of power in Tbilisi, gathering dust, are the glass boxes full of Georgian dreams written down on cards by ordinary people filled with hope. A source with access to Georgian Dream’s offices managed to extract a handful of these cards and hand them over to me.

In these cards, people ask the oligarch for jobs and apartments, to sponsor tuition fees and medical treatment. Reading through these requests, I began to see how easy it was for one absurdly wealthy man to trick a whole country into surrendering itself to him. 

Perhaps the most painful part of Georgia’s rapid descent towards dictatorship is that you now see people you know – friends, relatives, colleagues – becoming a part of the system, or at least refusing to resist it. 

When the dictatorship of my childhood imploded, an entire generation, including university professors like my parents, found themselves lost and unneeded in the strange new world that the shattered superpower left in its wake. That world belonged to opportunists like Ivanishvili, who made fortunes in murky waters. Those who could not, migrated, streaming abroad to make a living. They drove cabs and cleaned homes in foreign cities, complaining to their eye-rolling clients that they were educated professionals – teachers, engineers and musicians – back in their obscure homeland.   

Maybe people in those cities, even now, look at Georgia and say “that could never happen to us.” They have, they reassure themselves, democratic traditions that go way back and institutions in place to guard against encroachments on their freedoms. “We will,” they might say, “never be a Georgia.” They would be wrong.

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Last week, I went to Montserrat on a research trip, the fruits of which I may one day divulge to you, if indeed there ever are any. It is a small British island in the Caribbean with the unusual distinction of being an ex-tax haven.

I am fascinated by the dynamics of how small jurisdictions decide to monetise their sovereignty in an age of globalised money flows. Most recently this has involved places like Dubai, Ireland and South Dakota, but back in the 1970s and 80s, it was a process centred on islands in the Caribbean that were ideally positioned to help people from both North and South America dodge taxes and launder money.

”By most accounts, it was a stunningly sleazy climate in which to operate”, it says in this fun article on the cricket entrepreneur and convicted fraudster Allen Stanford, whose huge Ponzi scheme started life in Montserrat. “The vast majority of the Montserrat instabanks existed only on paper; their owners scarcely if ever visited the island. Scores of these banks would later be probed by British and U.S. authorities. One, Zurich Overseas Bank, whose owners would be indicted for fraud in Detroit, operated out of the Chez Nous tavern in the Montserrat town of Plymouth” 

Of course it takes more than a few investigations to get a British overseas territory out of the sleaze business – for evidence, look no further than the British Virgin Islands, which are once again under “increased scrutiny” after missing a deadline this summer to institute more corporate transparency. And in Montserrat’s case, it took a volcano. In 1995, the Soufriere Hills awoke after a long period of dormancy and, over the next couple of years, obliterated Plymouth, (you can see some photos I took on my Instagram of what it looks like now) which made it impossible to maintain any kind of life there at all, let alone a business.

Montserrat is a beautiful island, with turtles burying eggs on its beaches, hummingbirds dipping into flowers, and odd creatures called agoutis zooming about, but it’s suffered terribly. Most of the population has left, and half the island is still an exclusion zone. It would, in short, be nice if there were a better way to get jurisdictions out of the money laundering game than blowing them up. There is, of course, another way to do it, with no volcanoes involved, but to find out about that and to judge for yourself whether it’s better or worse than what happened to Montserrat, you’ll need to buy my new book, “Everybody Loves Our Dollars”, which is coming out in January (available for pre-order now).

THE CROOKED POLITICIANS’ CLUB

That’s not say that blowing things up is necessarily bad, particularly if you play this gloriously old-school computer game, in which you are an anti-corruption activist seeking evidence against the kleptocratic rulers of The Republic of Congo by bouncing about, shooting at them, and eventually gathering evidence that they’re rigging elections. I am not a skilled gamer, but I do like a 2D shoot-‘em-up.

Denis Sassou Nguesso has, but for a violent five-year interruption, been president of Congo (often called “Congo-Brazzaville”, to distinguish it from its neighbour, the Democratic Republic of Congo) since 1979. He has been accused of establishing one of the world’s most egregious kleptocracies, with family members becoming vastly wealthy thanks to corruption around the nation’s oil reserves, and investing some of these proceeds in France and the United States.

Anyway, he’s seeking re-election next year, which is likely to be a formality, but – as the game shows – anti-corruption activists from the Sassoufit Collective are not giving up yet. “Congo is heading toward a future where incompetence will replace greed, where amateurism will replace bad faith, and where the state risks becoming a mere family patrimony,” it said in August. Sassou Nguesso  is no longer as welcome in Western capitals as he once was. Fortunately, he has found new friends in Vladimir Putin and Xi Jinping, so that’s nice. 

Sassoufit Collective’s founder, Andrea Ngombet Malewa, has previously warned his compatriots against allying too closely with China, which he argues is an accelerator of kleptocracy. “One of the most alarming results of Sino-Congolese cooperation in recent years has been the establishment of a banking structure that allows money to move across international borders without the standard accountability and transparency measures associated with financial institutions based in the democratic world,” he wrote in 2023. Of course, that was before the US crypto-rush. There are now quite a lot of blockchain-enabled options for kleptocrats seeking financial solutions without “standard accountability and transparency measures”, and more appear all the time.

President Sassou Nguesso’s exclusion from Europe and resulting pivot towards China is the fruit of hard work by the excellent people of Sherpa, a French anti-kleptocracy group. For years, they insisted that French prosecutors should investigate foreign politicians’ property ownership in France. The prosecutors did not want to, but were eventually given no choice. All kinds of delicious carnage ensued, featuring the leaders of Congo, Gabon and Equatorial Guinea. Piqued, the politicians flounced off to Beijing and Moscow.

That all looked like a final convulsion for the unlovely Francafrique policy, in which politicians in Paris and various African autocracies propped each other up with money, diplomacy and covert operations. But then last week Nicolas Sarkozy was jailed for five years for supposedly soliciting funds from Libya’s Muammar Gadaffi, in what felt like a repeat of the old tricks French politicians got up to, so perhaps those ancient friendships persist after all.

Incidentally, Sherpa joined the Sarkozy case as a civil party more than a decade ago and pushed for the ex-president’s prosecution, showing a template for what civic-minded lawyers are able to achieve. “This case is not limited to one French election. It reveals how certain political and economic elites have deliberately turned a blind eye to the predatory practices of authoritarian regimes and actively participated in the misappropriation of funds,” the NGO said in a statement.

On the other side of the channel, however, there is a different legal tradition and Sassou Nguesso appointed a London law firm to push back against allegations of kleptocracy. That was almost two decades ago, and perhaps lawyers would be more circumspect about who they choose to represent now. Or perhaps not, as unscrupulous law firms continue to use libel laws to help wealthy criminals evade scrutiny. So well done to the Tax Policy Associates for working hard to expose what’s sadly still going on.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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There is a saying that the best way to make money during a gold rush is to sell picks and shovels. The worst way, presumably, would be to run a government taskforce drafting regulations for the retailers of picks and shovels.

Perhaps relatedly, Bo Hines – who from January to August was the executive director of President Donald Trump’s council of advisors on digital assets – has been hired to run the US operations of Tether, the company behind USDT, the world’s largest stablecoin. USDT is a cryptocurrency that functions a little like a pick/shovel does during a gold rush. Now Tether will release a new U.S.-based stablecoin called USAT. 

Anyone alarmed by the implications of Hines changing sides can be reassured. There is no conflict of interest, because Hines himself said so: “I stepped down from my roles touching anything related to crypto in the White House and I felt like this was a fantastic opportunity to jump into the private sector.”

It must have smarted for Hines to be languishing in the public sector drafting regulations for the crypto rush, while in the private sector people – including family members of senior administration officials – were making billions of dollars. USDT, the stablecoin Tether has created for the US market, is being marketed in partnership with Cantor Fitzgerald, which is run by Brandon Lutnick, son of Howard Lutnick, the U.S. Secretary of Commerce, so that too is being kept in the family.

In order to guarantee that Tether’s tokens will always be worth the same as a dollar, it owns a lot of US debt: some $127 billion worth at the end of July, which works out basically as $127 billion of free money for the U.S. government.

“Tether is by far and away the most important private-public partnership the U.S. government has, we’re buying more treasuries than anyone else in the private sector,” said Hines, which is an interesting way of defining ‘important’. Once upon a time, the major defence contractors would have ranked top of the list, but now it’s a company that buys debt so Trump can keep cutting taxes for his friends.

This is not to say the U.S. government isn’t concerned about crypto. The Office of Foreign Assets Control has sanctioned Iranian nationals, Alireza Derakhshan and Arash Estaki Alivand, and a network of foreign enablers, who were selling Iran’s oil to raise money for its armed forces via the medium of cryptocurrency.

“Iranian entities rely on shadow banking networks to evade sanctions and move millions through the international financial system,” said John Hurley, Under Secretary of the Treasury for Terrorism and Financial Intelligence. But you’ll scour that press release and related documents in vain for information about what specific cryptocurrency was being used by the Iranians to finance the sale of hundreds of millions of dollars worth of oil. Luckily, you can turn to this bit of analysis from Elliptic: “Alivand’s addresses have received a total of $300 million, while Derakhshan’s have received $442 million, mostly in the USDT stablecoin”.

Oh. 

So, Iran sells oil for USDT; which creates demand for Tether; which buys US government debt. Cut out the middleman and essentially, thanks to the magic of the blockchain, the Iranian and US governments are in business with each other.

It seems a bit weird that the United States so enthusiastically prints $100 bills even though the only significant market for them is organised criminals, who do far more damage than the U.S. makes in profits from the trade. And it’s very disturbing that the government IS making the same mistake with cryptocurrencies.

TUVALU AHOY!

One of the annoying things about financial skulduggery is that new techniques keep getting invented all the time, even as the old techniques remain as useful as ever. If crypto is offshore’s newest manifestation, then flags of convenience are probably its oldest.

Ships have been flying other countries’ flags as a ruse de guerre for centuries, but it only really became a formalised business technique in the 1920s when American vessels reflagged as Panamanian so they could sell alcohol during prohibition. But as with everything offshore, a trick invented for naughty rich folks – in this case so they could drink cocktails without legal consequences – has morphed into a tool for criminals and scumbags to make life worse for everyone.

Flags of convenience are almost ludicrously artificial, even by the standards of other offshore trickery, in that registries often have only the sketchiest relationship with the country they’re nominally part of. The Palau, Marshallese and Liberian ship registries are all in the United States (as was Panama’s, until recently); St Kitts and Nevis’ is in the UK; Tuvalu’s is in Singapore; Togo’s is in Lebanon, etc. Small countries are basically just hiring out their sovereignty so foreigners can do dodgy stuff with boats.

The most recent manifestation of this is in Russia’s shadow fleet of ageing oil tankers, some of which lost their Liberian flags and re-registered under the flag of Gabon (effectively a private company based in the UAE), as they sought to continue evading Western sanctions while they sail through the English Channel. “The ease with which vessels can obtain flags without scrutiny, avoid ownership transparency and escape enforcement actions has created the conditions for an entire parallel shipping ecosystem,” notes the Royal United Services Institute (RUSI) in this fascinating paper.

Western countries have sought to do something about this, and some larger registries have become more compliant under pressure, but that has just encouraged new countries to hire out their flags to all-comers, including “Cameroon, Comoros, Gambia, Honduras, Mongolia, São Tomé and Príncipe, Sierra Leone and Tanzania”. RUSI calls for states issuing flags of convenience to be checked by the Financial Action Task Force, which raises the prospect of blacklisting for rogue actors. 

I am not as a rule a big fan of the FATF (or indeed of how it goes about blacklisting countries), but the situation has got so bad, that perhaps it is the only body that could now make a difference and head off consequences that are almost impossible to overestimate. “Without such action, the shadow fleet will continue to entrench itself as a parallel system that threatens financial security, undermines legal norms, poses immeasurable environmental risk and raises the threat of geopolitical escalation,” RUSI’s paper concludes.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The post The Tehran-Washington Crypto Connection appeared first on Coda Story.

“Arwa it’s changed so much since you were last here, like you can’t imagine.” This was a message I received a few months ago from Yousra, the program coordinator at my charity INARA in Gaza. My last trip to Gaza was in December 2024. When I tried again a few months later, in February and in March, Israel denied me entry – no reason given. Back then, roughly a third of people attempting to enter on humanitarian or medical missions were being stopped, now that number is over half. 

The images rolling through my mind of what I had seen over four humanitarian missions were already apocalyptic. I tried to picture “worse”. The children and adults I saw, in a crush of bodies, faces frozen in a grimace of despair and grief as they held out their empty pots. I tried to amplify the deadened eyes, the lethargic movements of starving people, and the soundtrack of desperate voices not quite drowned out by the incessant buzz of drones overhead. 

Mohammed, INARA’s physical therapist in Gaza City, had sent me a couple videos of Souhaib, a little boy he’s treating. Souhaib had woken up one morning unable to move. He was admitted to the ICU and then spent a month in the hospital, but his condition did not change all that much. 

The doctor’s preliminary diagnosis was acute flaccid paralysis – most likely a rare disease known as Guillain-Barre Syndrome (GBS), a rapid-onset muscle weakness caused by the immune system damaging the peripheral nervous system. But that diagnosis hasn’t been confirmed and cannot be confirmed in Gaza because the tests Sohaib needs aren’t available. All anyone can do is to give Sohaib physical therapy and hope that the paralysis doesn’t move to his involuntary nerves, his internal organs, which would lead to death. 

Soubaib is malnourished, his head looks unnaturally big with its shock of blond hair, but Mohammad manages to coax smiles and giggles out of him as he moves his limp limbs. Souhaib is not the only child suffering in this way. There has been a spike in cases of suspected GBS. Where normally there would be one or two cases annually, now there are dozens, a byproduct of the lack of sanitation and lack of food. In Gaza, people’s bodies – especially those of children – have become too weak to fight infection. 

“It’s like we’ve been issued a death sentence, only it’s a slow and excruciating execution” Mohammed messaged me on the day that famine, according to the United Nation’s IPC scale, was officially confirmed in Gaza City. Not that the people there needed a report to know that they were starving and being starved. 

Hunger related deaths have soared to more than 400, including 145 children.

Ever since Israel implemented its full blockade on humanitarian trucks when it broke the ceasefire back in March there has been nothing “sustainable” or durable in what we, or frankly any of us in the humanitarian community, do or are allowed to do. We require Israel’s permission to pick up our pallets from the crossing point, to move waste, to fix bombed water lines, to cross through red zones and within the vast majority of Gaza, basically to do just about anything. In theory it’s meant to protect us from Israeli strikes. In reality, it’s always a gamble. Gaza is the deadliest place for humanitarians.

In May, Israel and the United States established the Gaza Humanitarian Foundation, replacing a pre-existing and proven system of at least 400 distribution points with just four located inside Israel’s red zones. Since then, more than a thousand people have been killed by Israeli guns, drones and tanks, just trying to get food from these locations. Doctors Without Borders, whose staff regularly receive mass influxes of casualties following violence at GHF sites, plainly stated: “This is not aid. This is orchestrated killing.’

Under international and U.S. pressure, Israel has been allowing a “trickle” of aid trucks to enter Gaza along with those carrying commercial goods destined for the market where few can afford the astronomical purchase costs. 

A parcel of fresh vegetables weighing six kilograms (around 13 pounds) – not anything brought from the outside, but local produce from the few greenhouses still accessible – costs around $120. When the vegetables are delivered, I’m struck by how little children are grinning and grabbing at a cucumber like it’s candy on Halloween. 

My INARA team goes to visit the home of a mother who showed up at our Gaza City clinic utterly beside herself and hysterical. Her twin boys’ bottoms scream with angry red diaper rash. Her husband holds out the can of baby formula with barely two scoops left. And one of her daughters ducks her head in shame as her mother shows our team her shaved head, raw with scabs from scratching because she had lice. The team returns with whatever they’ve been able to scratch together: a little shampoo, soap, baby formula and diapers.

One of the boys tells Yousra that it’s his birthday the next day. His mother says that all he has been asking for is bread. Not cake. Gazan children don’t even dare to dream of cake. Yousra returns, having searched for hours, on her own time, with a “bread cake”. As many loaves as she was able to find and a single candle. 

The boy’s smile is pure magic. 

“I had to do it,” Yousra told me later. “I just had to give him a little bit of joy.”

When I read the news, some days ago, about Israel dropping leaflets over Gaza City, ordering its one million residents to move south, I was in a panic. 

I breathed a sigh of semi-relief when I heard from Yousra, when she finally got a signal on her phone. 

And then Yousra sends a message and video that just shreds me.

“I didn’t want to leave my sons (7 and 10) alone while I was at work in case there was an evacuation order or a bombing, so I took them to my sister’s house” Yousra said. “We saw a very young girl lifting very heavy jerry cans, so I asked my older son to get out of the car to help her. I wanted my son to have this empathy, to help her and to know how exhausting her situation is.” 

“Don’t worry”, though, Yousra continued. “We are strong enough to support others. We are here for our families, for the team, and for the people.” 

Yet there is no strength in the world that can withstand the level of bombing that is raining hell beyond hell down on Gaza. And as Israel launched its ground offensive in Gaza City this week, sending in thousands of troops, there has been a crushing sense of finality. That people, forced to flee, are saying goodbye to their city, their homes, for the last time. 

Our staff in Deir al-Balah, in the middle of the Gaza Strip,  have been providing those evacuated from the north with fresh vegetable parcels purchased from the market. I was sent a video of a boy laughing as he bit into a tomato. “I can’t wait for my mom to make salad,” he says. “I’m so hungry!”

Earlier this week Mohammed tried to scout out a possible location for a tent for himself and his elderly parents. He sent me a video of the traffic jam along Gaza’s coastal road, people who are heeding Israel’s warning to leave the city. 

Others are still stuck in the city, even as the Israeli tanks enter. “No one knows what to do”, he says. “I’m watching people in the street, they are just going around in circles, gasping and crying about how they can’t leave, don’t know where to go or how to get there.”

Mohammed, himself, feels deeply conflicted about leaving. “Arwa,” he tells me, “we didn’t evacuate when most people did last time, but I think we are going to have to this time. It burns me inside, it burns. It’s so painful. Where does this road end?” What answer is it possible to give him? “I wish,” he wrote, “I wish not to be displaced from our land. And to not be then displaced to Egypt. And to not then be displaced to South Sudan etc etc.”

He knows, like everyone in Gaza, how the Israelis and the Trump administration casually float ideas about where Gazans can be moved, how easily their land can be emptied. 

That time has now come. Our primary care clinic, which was seeing 120 patients a day in Gaza City, has been moved further west, towards the coast. Four of our staff are refusing to leave and will continue to operate it for as long as they can. 

The rest of our staff have now been forcibly evacuated further south, into tents and concrete rooms with no running water or electricity. 

“You know Arwa,” Yousra says after spending 12 hours stuck in a sea of human misery making its way south, “it’s what you don’t see in the videos. It’s the women just sitting along the side of the road with one plastic bag between their legs, too tired to walk.” She’s struggling to find the words to express what she’s witnessed. And what keeps her going. “I want to live,” she tells me. “Not because I’m scared of death. I want to live so I can keep testifying to what we endured and have to endure every day while the world just watches and does nothing. And I want to live, so I can keep helping my people.”

A version of this article was published in our Sunday Read newsletter. Sign up here.

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The full-scale invasion of Ukraine happened more than three years ago, which means full-scale Western sanctions on Russia did too. Concurrently, Russians have had just as long to figure out ways to dodge those sanctions, and I fear Western countries are being a bit too slow in realising quite how good they’re getting at it.

So, props to Transparency International’s exiled Russian chapter for this excellent report on the new laundromat, which has grown out of the Garantex crypto exchange that was shut down in April after a multi-year, multi-country effort. There is something grimly depressing, if inevitable, about the fact that within days of Garantex being snuffed out, it had been reborn. 

“It reemerged under new names, such as MKAN Coin, Grinex, and Exved, morphing into a decentralised laundering system sustained by technical obfuscation and governments’ tolerance,” TI-Russia notes. “Entities tied to Garantex continue operating across UAE, Brazil, Kyrgyzstan, Spain, Thailand, Georgia, Hong Kong, and Russia.”

Powered by the encrypted messaging app Telegram, the skilled launderers behind Garantex’s successors are learning to mitigate their vulnerabilities, rather like bacteria evolving in response to antibiotics. And they have found helpful new hosts, particularly in Kyrgyzstan. 

The rouble-pegged stablecoin A7A5 is, according to Chainalysis, operational largely in office hours, which suggests it is operating more like a shadow bank than the kind of cryptocurrencies beloved of speculators in the West. By the end of July, more than a billion dollars’ worth of transactions were moving through A7A5 every day, with it being used as a bridge between roubles and the dollar-backed cryptocurrency Tether, adding a layer of obfuscation that helps to obscure connections between Russian sanctions-busters and the big crypto operators.

There is nothing too surprising about this: money launderers have nimbly adjusted to limits on their activities ever since there have been attempts to limit those activities. In many respects, the way that Garantex’s successors have spread across jurisdictions, taking advantage of mismatches between legislation and law enforcement capabilities, is just a digital-age copy of the way the drug cartels’ bankers operated in the Caribbean in the 1980s.

Nonetheless, it is depressing that Western governments appear not to be learning as rapidly as their adversaries, and instead are relying on the blunt instrument of sanctions, rather than engaging more proactively with the causes of the problem. This is not to say that sanctions do not have their uses. They are obviously useful as a first step, and clearly very irritating to kleptocrats, otherwise they wouldn’t fight so hard to overturn them. 

For instance, Viktor Yanukovych, the corrupt former president of Ukraine whose disastrous tenure sowed so many of the problems that are causing death and misery today, has been fighting to cancel European Union sanctions against him for more than a decade. He’s now failed to have the courts overturn those sanctions, as has his son, which is wonderful. Yanukovych always seemed to have a tenuous grasp on reality, and this is nowhere more in evidence than in the apparent plot to reinstall him as president of Ukraine after the Russian full-scale invasion, which is detailed in the court’s judgement. The idea that anyone in Ukraine wanted him back goes way past self-confidence and deep into the territory of profound delusion. A weird but true aside: Yanukovych’s press secretary once bit me on the arm to prevent me asking him a question about a ludicrous inconsistency in a speech he’d just made; it was very painful, and very effective.

CHINESE GANGS & MEXICAN CARTELS

Much of the early structures used by money launderers were created in the 1950s and 1960s to serve wealthy people looking to dodge the era’s strict capital controls and high taxes. Just as today, it is the desire of wealthy Chinese people to evade capital controls that drives innovation and growth in money laundering methods.

“Chinese money laundering networks are global and pervasive, and they must be dismantled,” said FinCEN Director Andrea Gacki. “These networks launder proceeds for Mexico-based drug cartels and are involved in other significant, underground money movement schemes within the United States and around the world.” 

The core of the system is that Mexican cartels are earning huge amounts of cash dollars, which they are unable to pay into banks. So they hand them over to Chinese gangs, which in turn sell them to wealthy Chinese people looking to spend in the West. The circle is completed by the Chinese gangs shipping counterfeit goods, precursor chemicals or other things that the Mexicans need.

FinCEN has issued an advisory with guidance on what Chinese Money Laundering Networks look like, which makes very interesting reading, especially its long list of “red flags”, each one helpfully illustrated by an actual red flag. The trouble of course for the U.S. authorities is that most of the action happens outside their oversight.

With one exception: the White House could always seek to limit the printing of cash dollars that are the lifeblood of the whole system. At the very least, it could stop printing so many of the super-convenient $100 bills. But it’s not doing that. On the contrary, the value of dollars in circulation hit a new all-time high in July.

TAKING BACK ILL-GOTTEN GAINS

Among the curious folkways of British politics is that TV dramas have far more impact on political discussion than even the most considered bit of journalism. Misha Glenny’s book, McMafia, came out in 2008 and received excellent reviews for its forensic analysis of organised criminality. But it was only when a TV drama of the same name appeared a decade later that U.K. politicians woke up to London’s central role in laundering the world’s criminal wealth. 

They nicknamed a new legislative proposal “the McMafia law”, and promised it would drive kleptocratic wealth out of London. Spoiler alert: life is not a TV drama, and there was no happy ending. Lawyers fought back, and the impact of the Unexplained Wealth Order was limited.

But, wait, what’s this? The Serious Fraud Office has used an Unexplained Wealth Order to confiscate a 1.1 million pound house! So there is life in the old law yet. Granted the target was not a kleptocrat, but a fraudster; the house was not in London, but in the Lake District; and 1.1 million pounds is a rounding error compared to the 100 billion pounds or so of criminal wealth estimated to pass through the UK financial system every year. But a win’s a win, and they deserve congratulations. “Unexplained wealth orders offer investigative opportunities to pursue assets on behalf of victims and taxpayers. This is our first successful use of this legislation and it certainly won’t be the last,” said Nick Ephgrave, Director of the Serious Fraud Office. Hooray for that.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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As you may have noticed, I’ve been away for a couple of weeks. I spent my days off in Scotland’s Inner Hebrides, in search of the legacy of the only famous person there has ever been with the same surname as me: Sir George Bullough, a late Victorian moustachioed flaneur who inherited a fortune and spent it hard on horses, yachts and the Isle of Rum.

He gifted the island a mausoleum and a castle that is architecturally foul even by late-Victorian standards (“nothing that a good fire and subsequent demolition couldn’t rectify”), but us Bulloughs have to take what we’re given, so I dragged the family off to have a look, even though we are – at least as far as I know – completely unrelated to him. 

In its glory days, Kinloch Castle – which looks vaguely like a sandstone version of Shawshank prison reimagined by someone who’s read too much Walter Scott – was quite something. Sir George imported 250,000 tonnes of topsoil for the gardens, built heated greenhouses for his collections of hummingbirds, alligators and turtles, and installed one of Scotland’s first electricity generators. He paid his gardeners extra if they wore kilts, and built the laundry on the uninhabited north side of the island because his wife didn’t want anyone to see her knickers drying on the line.

Like the Titanic, the castle is a monument to the hubris of the European ruling classes in the years before World War One. Built at vast expense, it relied on a reserve of cheaply-paid labour that vanished with the arrival of hostilities, and – as with the European empires of the time – never recovered.

“There were only the boys left, of which I was one, to maintain the gardens and the greenhouses,” remembered a gardener in a passage quoted in a book on the Bulloughs. “The grapes, the peaches and the orchids vanished, gradually sliding into the wilderness of weeds and broken glass that marks their position today.”

Sir George and Lady Monica’s wealth never recovered either. In her old age, Lady Monica sold the island at a knock-down price to the Scottish government, which has let the castle slip into disrepair, and I can’t say I blame it.

This feels symbolic too. The decades after 1914 marked a collapse in wealth inequality, and a playboy’s crumbling mansion was an apt metaphor for how profligate that whole generation looked to those who came later.

However, the wheel keeps turning: wealth inequality started to grow once more in the 1970s, and is now – including, worryingly, in the United Kingdom – approaching previous heights. “At the top of the American economic summit, the richest of the nation’s rich now hold as large a wealth share as they did in the 1920s,” it says here.

This is bad news for democracy and risks sending us back to a future when those of us whose net worth does not include multiple commas have to live in an isolated hovel in a midgy, rainswept bay and wash oligarchs’ underwear. But bad news for democracy could be good news for Sir George’s folly. Kinloch Castle is on the market for 750,000 pounds, although its new owners are unlikely to be able to move in immediately. “It requires significant refurbishment to return it to full residential or hospitality use. Repair and redevelopment costs are likely to be in the region of approximately 10 million pounds or more,” the estate agent notes. 

Having looked at it, and considering its isolated location, I would say 20 million is a more reasonable estimate but, whatever the cost, surely some of my readers have a few quid they can chuck at the one material legacy left to this world by a Bullough? And since you ask: yes, once you’ve patched the roof, restored the orchestrion and employed some decent chefs, I’d be more than willing to come and stay. The island is absolutely stunning. In buying Rum, if in nothing else, Sir George showed excellent taste.

A NEW AGE OF INEQUALITY

It is sadly easier to spot sell signals after a market has crashed. To his contemporaries, Sir George’s castle – along with the other extravagances of the Gilded Age – presumably looked like a perfectly reasonable thing to spend money on, rather than a symbol of excess and frivolity. I would challenge anyone, however, to look at Trojena and not think that it is a gigantic flashing stop sign for civilisation.

A proposed ski resort in Saudi Arabia, it is being built in mountains where there is almost no precipitation, so all the water must come from the ocean, which is at a distance of 200 km laterally and 2.6km vertically. Once the salt has been removed (at a vast cost in both money and carbon), the water is to be pumped uphill through a metre-diameter pipe, and then stored in an artificial lake, which will provide all the resort’s needs, including for the manufacture of the snow required for its 30km of runs. The 140 meter-deep lake requires three separate dams and will cost $4.7 billion to build, according to Italian company Webuild. Just filling it up will take two years of pumping.

“Webuild will also create the futuristic Bow, an architectural structure that will extend the surface of the lake beyond the front of the main dam. It will be shaped like the prow of a ship suspended over the valley, and will house a luxury hotel, as well as a residential area and a large central atrium, with accommodation and hospitality facilities,” the company stated.

This is part of the Neom project and, like all the other bits, looks like a snazzy futuristic vision in the architects’ renderings, when in fact it is a deranged climate-destroying hellscape, which even Mohammed bin Salman is struggling to afford. Trojena is supposed to be hosting the Asian Winter Games in 2029, but apparently Riyadh has been sounding out whether another city could step in so they can do it four years later. 

My optimistic prediction is that, in a century’s time, regardless of whether Trojena ever hosts a skiing competition or not, someone will be looking at its ruins and making notes for a sarcastic newsletter about the excesses of this age of inequality. My pessimistic prediction is so depressing it doesn’t bear thinking about.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The post The Bulloughs of Kinloch Castle appeared first on Coda Story.

Philanthropist is a great word, deriving as it does from an ancient Greek term for “love of humankind”. In theory it could describe almost any decent person but, in practice, it is reserved for very rich people – Mackenzie Scott, Bill Gates, Roger Federer – who demonstrate that love by spending lots of money.

It is incredibly odd how much hate Gates gets, considering the volume of crucial medical research that is being funded by his foundation. And he has also pushed for other billionaires to give their wealth away, via 2010’s Giving Pledge that he made alongside Warren Buffett, but if you thought that meant our new breed of oligarchs was chucking money out the door faster than it came in, a new report has worrying news.

“Three quarters of the original U.S. Giving Pledgers who are still alive remain billionaires today, and they have collectively gotten far wealthier since they signed, while just eight of 22 deceased Pledgers fulfilled their pledges. What’s more, most of these contributions have gone to private foundations or donor-advised funds (DAFs), which can warehouse wealth for years without paying it out to working charities,” concluded the Institute for Policy Studies.

Mark Zuckerberg and Priscilla Chan, who signed the pledge, have seen their wealth increase by 4,000 percent since 2010, which – if nothing else – suggests they were not very good at giving money away even before their recent decision to close tuition-free schools they’ve been funding.

In this they are not alone: billionaire wealth is increasing globally, growing three times faster than the rate of inflation, while hundreds of millions of people live extremely precarious lives, and life expectancy has begun to fall even in some wealthy countries.

I don’t want to give the impression I am opposed to charitable giving by rich people. The Wellcome Trust (created by Henry Wellcome before World War Two) does incredible work, as do many other organisations founded by past tycoons. But I do think that the modern-day iteration of philanthropy gives an impression of generosity, which is almost always not matched in reality.

The most extreme example recently is that of Sam Bankman-Fried, who yakked on to anyone that would listen about effective altruism, a movement which is perhaps the perfect distillation of the neoliberal version of philanthropy, while running a gigantic fraud. But, even in cases of law-abiding tycoons, the impression of generosity takes the pressure off them to pay the taxes needed to support democratic societies.

The IFS says “instead of allowing the ultra-wealthy to park trillions for generations in family-controlled foundations and intermediaries such as donor-advised funds, we must strengthen the rules that currently allow them to use these vehicles for tax avoidance”, and I couldn’t agree more.

A lot of problems cannot be solved by just throwing money at them: hiring a nanny is not equivalent to being a parent; paying for a therapist is no replacement for being a friend; giving donations to organisations is not the same as being a citizen. I understand that this must be annoying for a billionaire to pay a huge amount of tax and then watch it being spent on something you don’t agree with, but that’s something we all have to put up with in a democracy. If you don’t like it, there are plenty of countries out there with other political systems you could try; or else, you can try to persuade people to vote for you. Of course, Zuckerberg did think about trying that, and you really should read about it in ‘Careless People’. It’s hilarious.

THE WHITE HOUSE ABANDONS HUMAN RIGHTS? 

A couple of months ago, the foreign ministries of Russia and Belarus released their joint report on the “Human Rights Situation in Certain Countries”. Now I feel sure that all readers of this newsletter will have already perused this document’s 1,500-odd pages in depth, but just in case you haven’t, it’s basically a deeply weird attempt to insist that the world’s most pressing question remains World War Two, and therefore the worst problems occur in those countries that object to having been occupied by the Soviet Union.

As far as I can tell, Moscow started producing this report not because it cares about human rights (if it does, it has a strange way of showing it) but because it deeply objected to the fact the U.S. State Department had for decades published its own annual report accusing Russia of mistreating its own citizens, and the Kremlin wanted to get its own back. The difference between the two reports of course was that the American one was respected and authoritative and the Russia one was absurd.

Respected and authoritative that was until last week, when the 2024 US reports were published with many of the same flaws as the Russian ones have long had. “Entire categories of interest were removed. The Obama administration had previously put a strong focus on corruption, on the grounds that kleptocracy and autocracy are deeply linked,” noted Anne Applebaum. “The revisions also go much further than expected, dropping references to corruption, restrictions on free and fair elections, rights to a fair trial, and the harassment of human-rights organisations.”

Citizens of countries less fortunate than the United States had long relied on the State Department’s reports for support in their campaigns against their own governments, often against huge odds. This is just the latest example of the White House abandoning people who had previously depended on it.

AN EDUCATION IN SANCTIONS EVASION

While I’m talking about Russia, I recommend this article by Tom Keatinge on how universities are now teaching courses in sanctions evasion. Indeed, in one Moscow university, the course is compulsory for law students. 

“The Kremlin views itself as being at economic war with the West, thus requiring a whole-of-society response including training future generations in the art of sanctions circumvention and new approaches to cross-border payments that avoid the US dollar and other western currencies. The counterparts of the troops being thrown into the meatgrinder in Eastern Ukraine are the businessmen, accountants and financiers learning these new tools,” Keatinge writes.

It is very frustrating to me that we in the West are not working to defend our values as seriously as people in Moscow are working to undermine them.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

The post Tax-dodging philanthropists & Whitewashing autocrats appeared first on Coda Story.

Even as Zelensky and his European allies descended on Washington, I found myself still processing what we had witnessed just days earlier in Alaska, where Putin and Trump turned crisis into theater, and where Putin issued a seductive invitation to step "from yesterday into tomorrow."

Put aside memories, responsibility, and accountability, he suggested. Drift into business as usual.

Every summer, when news slows to a languid crawl, journalists trade a well-worn joke: just wait, August will deliver its crisis. This August, the crisis came packaged as theater: a spectacle in Alaska with Trump and Putin center stage, military helicopters overhead, Russian Foreign Minister Sergey Lavrov in his intentionally provocative "USSR" sweatshirt and a swarm of media chasing every move.

Putin basked in his return from international isolation. Trump beamed as he applauded him. As far as we know, they achieved nothing. The summit wrapped up with vague platitudes..

I felt anger swell inside me as I watched the spectacle. Not at Putin or Trump, who are expertly playing the roles they have chosen for themselves, but at the rest of us who keep letting them get away with it.

The Media's Unwilling Complicity

In coverage of the Alaska summit, report after report on US television referred to Ukraine as "the war that started in 2022," echoing a narrative that strips away years of conflict, occupation, and loss. What Putin and Trump are successfully inviting us to forget isn't just the past, but the throughline of consequences that have brought us to this moment.

Our recent investigation exposes the anatomy of how authoritarians manipulate not just history but living memory itself: how the tweaking of tiny details, the quiet adjustment of timelines or the reframing of a single moment can change the entire story.

For me, the story is deeply personal. In 2008, Vladimir Putin carried out his first invasion of a sovereign state: Georgia. I flew home to cover the war for the BBC, filing updates on Russian troop movements, statements from officials, and frontline reports.

But my reports, no matter how thorough, sat within the BBC's larger narrative of the Georgia war as a sudden, out-of-the-blue August crisis. This narrative completely ignored the reality that for those living it, the war was simply the latest catastrophic chapter in Russia's decades-long campaign of aggression.

This is the paradox of news: one of society's essential pillars, designed to inform, yet structurally unable to capture the very continuity that defines how people experience life. The pressures are real: audience attention spans, commercial demands, the sheer volume of breaking news, but the effect remains the same. It makes news media, even well-intentioned, ethical media, an unwilling accomplice to authoritarian manipulation.

The Architecture of Forgetting

All of us understand our lives in context: in relation to history, memory, and culture. For Palestinians, today's violence is inseparable from the Nakba of 1948, the catastrophe that started their displacement. For Ukrainians, the conflict didn't begin in 2022. For Georgians, the war was never just five days long. For the Sudanese, the current war isn't separate from decades of Darfur's trauma.

When the news machine reduces these stories to start dates and breaking news alerts, it strips them of crucial continuity. It is precisely in these interrupted threads, these gaps where collective memory should live, that authoritarians find their opportunity.

Authoritarians operate in the spaces left empty by our collective forgetting, reshaping narratives and bending truth to serve their aims.

"I'm looking around, looking for a homeland inside my homeland," says one woman in Masho's piece, capturing the alienation spreading across societies where people are forced to give up not only their land but also their stories and memories, their truth.

Masho Lomashvili's investigation, "Erasing August: How Russia Rewrites Georgia's Story," was supported by Coda's Bruno Investigative Fellowship. We are currently seeking applications for our 2025-2026 Bruno Fellow. Apply here.

A version of this piece was originally published in our Sunday Read newsletter. Sign up here to receive weekly deep dives into the patterns of power shaping our world.

The post The Alaska Spectacle and the War on Memory appeared first on Coda Story.

There has been much speculation in financial circles that the White House’s erratic policymaking, random tariffs, and general shoot-from-the-hip approach could undermine the global role of the dollar, which could perhaps be replaced by the euro. I have no insight into that but I am confident that Europe’s single currency won’t replace greenbacks as criminals’ favourite money laundering tool any time soon.

Ordinary people are using cash money less and less in everyday life, so logically the amount of banknotes in circulation should be falling. Particularly at a time of high inflation, when a non-interest-bearing form of money is losing value all the time. This is what is happening in the eurozone, where the value of cash in circulation hit its all-time high in June 2022 of €1,602.6 billion, which was €16.2 billion more than the total today.

In the United States, on the other hand, the total number of dollars in circulation hits a new high every month, and in July reached $2,399.538 billion. That is an increase of $121.6 billion since June 2022, or just over five percent. The only people willing to hold paper currency when inflation is high are people who have a compelling reason not to care, and I think the only significant group of people that meet that requirement are criminals who seek anonymity. 

So while financial markets may find an alternative to the mighty dollar, at least the United States can count on the continued custom of the world’s criminals. Interestingly, the pound is behaving more like the dollar than the euro, with the total in circulation having increased by 5.9 percent since June 2022 to £93.6 billion. And the same is true of the Canadian dollar (up three percent). So I suppose an alternative explanation is that criminals just like speaking English?

BANKS CAN’T CLOSE CRYPTO BACKDOOR 

Of course one of the drivers of the dollar’s supposed decline is America’s geopolitical rivals creating new payment mechanisms outside of the Western system. Iran, under severe sanctions, has sought to create new routes for money to flow and the United States – including as recently as last week – has tried to stop that from happening.

“As a result of President Trump’s maximum pressure campaign and increasing isolation from the global financial system, the Iranian regime is running out of places to hide,” said Secretary of the Treasury Scott Bessent. “Treasury will continue to disrupt Iran’s schemes aimed at evading our sanctions, block its access to revenue, and starve its weapons programs of capital in order to protect the American people.”

Meanwhile, Trump has signed an executive order stopping the previous practice of encouraging banks from being highly sceptical of crypto clients, much to the delight of said clients. “It used to be that corresponding banks in the US block transactions involving crypto (fiat for buying crypto). This opens banking for crypto internationally,” tweeted Changpeng Zhao, founder of the giant Binance exchange.

But what does this mean for Iran? Iranians were already using crypto to evade sanctions, despite efforts by some of the better-connected companies to keep a lid on them.

“Iran’s government maintains extensive control over the country’s financial system, including cryptocurrency infrastructure,” concluded Chainalysis in an analysis published earlier this year. “Cryptocurrency represents an alternative financial system, and the increasing use of Iranian crypto exchanges suggests that more individuals and institutions are resorting to crypto to safeguard wealth and circumvent financial restrictions.”

I’m struggling to think of an analogy for what the U.S. government is doing here in its policy towards Iran’s illicit financial flows. By sanctioning the Cross-Border Interbank Messaging System used by Iranians, it’s shutting the door, but by banning U.S. banks from doing due diligence on crypto companies, it’s demolishing the wall. 

AN ATTACK OF CONSCIENCE

British real estate has been the investment of choice for kleptocrats for years, thanks to the country’s toothless regulators, conscience-free lawyers, and biddable politicians. But the war in Ukraine created much soul-searching in Britain about what exactly its approach had enabled, and a long-overdue re-examination of the system finally began, with – apparently – actual real-world consequences.

“British lawyer Rory Fordyce has been ordered to pay £32,500 for failing to adequately vet funds linked to the family of Azerbaijan’s former security chief,” reports the Organised Crime and Corruption Reporting Project (OCCRP). “In addition to the fine, Fordyce was barred from holding any legal management or compliance roles for five years and was ordered to pay £50,000 in legal costs.” And as if that wasn’t enough for the Solicitors Disciplinary Tribunal, a specialised court that brings cases against certain kinds of lawyers, it has also decided to prosecute another lawyer for making threats against people criticising the huge Ponzi scheme OneCoin, after detailed allegations were made by the Tax Policy Associates.

“Solicitors aren’t Daleks. We have ethical and professional obligations. We’re not permitted to act for an obvious fraud and threaten people who call out the fraud,” said TPA founder Dan Neidle.

The lawyer in question – Claire Gill of Carter-Ruck – denies any wrongdoing, and Carter-Ruck has promised to mount a vigorous defence. Still, hopefully this will encourage lawyers to be more diligent in checking the bona fides of their clients.

THIEVING OLIGARCHS

I’m sure many of the readers of this newsletter have read Richard Wilkinson’s and Kate Pickett’s ‘The Spirit Level’, published in 2009, with its thorough and convincing analysis of why inequality is bad for individuals and societies. I remember reading it at the time and thinking it could change the world but sadly that does not seem to have happened. 

Now Pickett is back with a series of blogs for the London School of Economics, starting with powerful posts on the environment, and health. There’s so much to think about in the global debate around oligarchy, and it’s easy to forget that it’s all about ordinary people’s lives, and how they are stunted when others cheat them of what should be theirs. 

“The picture is as tragic as it is clear regarding the gap between rich and poor and how this connects with myriad physical and mental health conditions,” she writes. “Countries with higher levels of income inequality are associated with higher rates of adult obesity and child overweightness, diabetes, mental illness, asthma, drug use and infant mortality.”

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

The post Criminal dollars, Trump’s crypto trapdoor, and Dalek solicitors appeared first on Coda Story.

There are now several books about the 2007-8 financial crisis, the best of which, in my opinion, is Adam Tooze’s ‘Crashed’. But the one that everyone remembers is Michael Lewis’s ‘The Big Short’, later made into a movie starring Christian Bale, Ryan Gosling, Steve Carell and Brad Pitt. Its narrative of misfits spotting the mistake everyone else was making is pleasing and elegant, so it’s easy to see why it’s so popular. 

Sadly, however, it’s completely wrong: bankers didn’t sell insanely risky financial instruments because they misunderstood them, but because the trade was profitable, and they didn’t care if they might blow up the world. 

And this brings me to some recent headlines in the FT – “Companies load up on niche crypto tokens to boost share prices” and “Crypto lenders dial up risk with ‘microfinance on steroids’” – which have very strong pre-2007 energy. Anyone with a brain knows this will end up in disaster, but folks with money want to keep dancing while the music plays, particularly as the United States has cranked up the volume.

“When President Trump took office in January, he promised to make America the ‘crypto capital of the world’. Today, the President’s Working Group on Digital Asset Markets is releasing a report that provides a roadmap to make that promise a reality,” pledged the White House last week in a new strategy document

Perhaps the idiocy of this strategy can be best understood by pointing out its reference to “Operation Choke Point 2.0”, a confected scandal named after another confected scandal. The reason banks denied services to crypto companies is because cryptocurrencies are frequently used to enable, commit and spread financial crime, so it was an entirely sensible decision. And yet here’s the White House repeating the branding dreamt up by lobbyists to claim it was some kind of campaign against free speech. Crypto, of course, being the answer to the alleged erosion of freedoms.

The crypto boom may in fact be worse than the mortgage-backed feeding frenzy that preceded 2007-8, because the technology is not just setting us up for a new crash but freeing civilisation’s enemies from the few checks upon them. 

BOOSTING FRAUD WITH BLOCKCHAIN

Back in May, FinCEN designated Cambodia’s Huione group as being of “Primary Money Laundering Concern”, to reflect its role as the epicentre of fraud in Southeast Asia. Once upon a time, a designation like that was enough to kill a dirty bank (such as Latvia’s ABLV). But for a marketplace that lives on Telegram and trades on the blockchain, it appears to make little or no difference. “Transaction data shows no meaningful decline. In fact, our data shows continued or even increased activity,” concluded Chainalysis about Huione’s fortunes.

Meanwhile, the rouble-denominated stablecoin A7A5 is transferring more than a billion dollars’ worth of value a day, in what is becoming a magnificently successful sanctions evasion scheme that dodges any possible controls. And that’s before we come onto the “coin swap services” that allow criminals to move value around without encountering any responsible nodes in the crypto system at all.

“A sizable proportion of the $3.6 billion in illicit and high-risk funds flowing through coin swap services originates from darknet markets, ransomware, credit card fraud, hacks, Russian military fundraisers operating in Ukraine, and online gambling. A significant proportion also relates to sanctioned activity, including North Korean money laundering,” notes Elliptic.

When I was in Washington DC a few months ago I had several troubling conversations with crypto people, who were distinguished above all by their complete refusal to accept the existence of any downsides to the spread of blockchain technology, or any benefits to the traditional financial architecture based around banks it would replace. I am, as anyone who has read my books will know, no fan of banks but governments are really going to miss the ability to monitor, control and block the movement of money when it’s gone.

SANCTIONS OVERREACH

Of course, the uneasy secret underlying most anti-money laundering policy is the amount of discretion it gives governments to poke around in our private lives, and how little right we have to appeal against it (this is what the original Operation Choke Point,, and the frustration around it, was about). We are therefore rather dependent on politicians not abusing these powers for their own ends. Which is unfortunate in the circumstances.

“Alexandre de Moraes has taken it upon himself to be judge and jury in an unlawful witch hunt against U.S. and Brazilian citizens and companies,” said Secretary of the Treasury Scott Bessent, in a statement announcing sanctions against the Brazilian judge who’s investigating former President Jair Bolsonaro on charges of attempting a coup.

There is a grotesque irony in the fact that these misguided sanctions are being enacted using the Sergei Magnitsky Act, which is intended to punish corruption and human rights abuses. Perhaps the lesson we need to learn is that there needs to be better oversight of all the powers we give to our governments. 

Considering the decades-long disastrous consequences caused by well-intentioned but badly-designed anti-money-laundering policies – not least the wholesale exclusion of Muslim charities from the banking system – this could end up being a good thing. Just looking for a silver lining here.

A DYSTOPIC DREAM DIES?

I was listening to ‘In the Studio’, the excellent BBC podcast, when what should pop up but an episode on Neom, the ridiculous linear city concept apparently inspired by the 1997 Bruce Willis movie ‘The Fifth Element’, though without the punkish charm. In case you haven’t heard of Neom, it’s “an experiment in urban living”, which will extend two parallel lines of mirrored skyscrapers across 100 miles of Saudi desert, an idea so hellish that even JG Ballard would surely reject it out of hand.

Anyway, it appears the government in Riyadh has realised that spending a trillion dollars or more on some architectural fever dream might be a bad idea. “They’re finally starting to make financially sound decisions,” a consultant told CNBC.

I have been slightly obsessed with Neom for a while, and my (least) favourite bit is always when the architects wax lyrical about Mohamed bin Salman – the delicacy of his vision, the profundity of his understanding – and then clam up as soon as someone asks whether it’s right for his government to sentence people to death for resisting eviction from their ancestral homes so this horrific new city can be built. 

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

The post A Crypto-fueled Crash, How Blockchain Blunts Sanctions & MBS’ Folly appeared first on Coda Story.

In September, the International Criminal Court will conduct a confirmation of charges hearing against warlord Joseph Kony. Leader of the once notorious rebel group Lord’s Resistance Army and the subject of ICC warrants dating back two decades, Kony is still at large, still evading arrest.

Thirteen years ago, a group of American do-gooders tried to do something about this. 

The NGO Invisible Children published a 30-minute YouTube video with high hopes. With their film ‘Kony 2012’, they sought to stop the Lord’s Resistance Army, which had kidnapped, killed and brought misery to families across several Central African nations since the late 1980s. The video opens with our blue orb home spinning in outer space as the director reminds us of our place in time. “Right now, there are more people on Facebook than there were on the planet 200 years ago,” he says. “Humanity's greatest desire is to belong and connect, and now, we see each other. We hear each other. We share what we love. And this connection is changing the way the world works.” In other words,  the technology of connection will solve this problem.

Despite the uber virality of the film,100 million plus views nearly overnight, Kony remains a free man, though much more infamous, and his victims didn’t get all the help they needed. The campaign seemed to embody slacktivism at its most poisonous: the high hope that you can change the world from your sofa.

“Hope,” Gloria Steinem once wrote, “is a very unruly emotion.” Steinem was writing about US politics in the Nixon era but the observation holds. Hope is at the core of how many of us think about the future. Do we have hope? That’s good. It’s bad if we have the opposite – despair, or even cynicism. 

Former CNN international correspondent, Arwa Damon knows this unruly quality of hope firsthand. For years she worked as a journalist in conflict zones. Now she helps kids injured by war through her charity called INARA. She discussed this work last month at ZEG Fest, Coda’s annual storytelling festival in Tbilisi. In war, Damon has seen how combatants toy with hope, holding out the possibility of more aid, less fighting only to undermine these visions of a better tomorrow. This way, she says they snuff out resistance. This way they win. 

In seeing this, and in surviving her own close calls, Damon told the Zeg attendees, she realized she didn’t need hope to motivate her. “Fuck hope,” she said to surprised laughter. 

So what motivates her to keep going? “Moral obligation,” she said. After everything she has seen, she simply cannot live with herself if she doesn’t help.  She doesn’t need to hope for an end to wars to help those injured by them now. In fact, such a hope might make her job harder because she’d have to deal with the despair when this hope gets dashed, as it will again and again. She can’t stop wars, but she can, and does, help the kids on the front lines. 

Most of us haven’t crawled through sewers to reach besieged Syrian cities or sat with children in Iraq recovering from vicious attacks. And most of us don’t spend our days marshalling aid convoys into war zones. But we see those scenes on our phones, in near real time. And many of us feel unsure what to do with that knowledge because most of us would like to do something about these horrors. How do we deal with this complex emotional reality? Especially since, even if we are not in a physical war zone, the information environment is packed with people fighting to control the narratives. In this moment of information overload and gargantuan problems, could clinging onto hope be doing us more harm than good? 

Emotion researchers like Dr. Marc Brackett will tell you that instead of thinking of emotions as good or bad, we can think of them as signals about ourselves and the world around us. And we could also think about them as behaviors in the real world. Dr. Brackett, who founded and runs the Center for Emotional Intelligence at Yale, said hope involves problem solving and planning. Think about exercising, which you might do because you hope to improve your body. In those cases hope could prove a useful motivator. “The people who only have hope but not a plan only really have despair,” Dr. Brackett explained “because hope doesn't result in an outcome.”  

Developing a workout plan seems doable. Developing a plan to capture a warlord or stop kids from suffering in wars is a good deal more complex. The 2010s internet gave us slacktivism and Kony 2012, which seems quaint compared to the 2020s internet with its doom scrolling, wars in Ukraine and Gaza and much more misery broadcast in real time. What should we do with this information? With this knowledge? 

Small wonder people tune out, or in our journalism jargon, practice news avoidance. But opting out of news doesn’t even provide a respite. Unless you’ve meticulously pruned your social media ecosystem, the wails of children, the worries about climate change, the looming threats of economic disruption or killer machines, those all can quickly crowd out whatever dopamine you got from that video of puppy taking its first wobbly steps. But paradoxically, the pursuit of feeling good, might actually be part of the problem of hope. 

I took these questions about hope to Dr. Lisa Feldman Barrett, an acclaimed psychologist and neuroscientist. She too talked less about our brains and more about our behaviors. The author of, among other things, How Emotions are Made, Dr. Barrett noted that we might experience hope in the moment as pleasant or energizing and it helps with creating an emotional regulation narrative. Meaning: we can endure difficulty in the present because we believe tomorrow we will feel better, it will get better. However, Barrett said hope alone as a motivator “might not be as resistant to the slings and arrows of life.” If you assume things will get better, and then they don’t, how do you keep going? 

“I think people misunderstand what's happening under the hood when you're feeling miserable,” she added. “Lots of times feel unpleasant not because they're wrong but because they're hard.”

I told Dr. Barrett about Damon’s belief that she keeps going because of moral obligation and she again looked at the emotional through the behavioral. “There is one way to think about moral responsibility as something different than hope,” she said, “but if hope is a discipline and you're doing something to make the parts of the world different you could call it the discipline of hope.” This could be a more durable motivation, she suggested, than one merely chasing a pleasant sensation that tomorrow will be better.  “My point is that, if your motivation is to feel good, whatever it is you are doing, your motivation will wane.”

After ‘Kony 2012’ shot to astonishing success, in terms of views, the creators raised tens of millions of dollars but achieved little on the ground – an early lesson in the limits of clicktivism. Once upon a time American do-gooders hoped they’d help Ugandan children simply by making a warlord infamous, now the viralness of  Kony 2012 feels like a window into a cringey past, a graveyard of hopes dashed. But maybe we just grew up. Maybe our present time and this information environment full of noise and warring parties asks more of us. Maybe hope has a place but among a whole emotional palate of motivations instead of a central pillar keeping us moving forward. Because let’s be honest: we may never get there.  Hope, as the experts told me, doesn’t work without a plan. And, raising hopes, especially grand ones like changing global events from your smartphone, only to have them dashed can actually prompt people to disengage, to despair maybe, or even to embrace cynicism so they don’t have to go through the difficult discipline of hope and potential disappointment.  

One day, during the start of the pandemic, when my home doubled as my office, I got a piece of professional advice I’ve held tight. A therapist who works with ER doctors shared with a group of us journalists that when we work on tasks that seem never ending, burnout is more likely. To prevent it, he advised that we right-size the problem. Put down the work from time to time, celebrate our achievements (especially in tough times), develop rituals and build out perspective to nourish us as we keep doing the work.

The pandemic ended but we bear the scars and warily look out at a horizon full of looming troubles, most of them way outside the control of any one of us. Both Dr. Marc Brackett and Dr. Lisa Feldman Barrett reminded me: emotions are complex and humans aren’t motivated by just one thing. But no matter what mountain we want to climb we would all do well to adopt this conception of hope as a discipline rather than just a feeling. Because in this environment, there’s always someone on the other side betting we’ll give up in despair.

A version of this story was published in last week’s Sunday Read newsletter. Sign up here.

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The post The Danger of Hope appeared first on Coda Story.

I was invited to deliver a keynote speech at the ‘AI for Good Summit’ this year, and I arrived at the venue with an open mind and hope for change. With a title “AI for social good: the new face of technosolutionism” and an abstract that clearly outlined the need to question what “good” is and the importance of confronting power, it wouldn’t be difficult to guess what my keynote planned to address. I had hoped my invitation to the summit was the beginning of engaging in critical self-reflection for the community. 

But this is what happened. Two hours before I was to deliver my keynote, the organisers approached me without prior warning and informed me that they had flagged my talk and it needed substantial altering or that I would have to withdraw myself as speaker. I had submitted the abstract for my talk to the summit over a month before, clearly indicating the kind of topics I planned to cover. I also submitted the slides for my talk a week prior to the event. 

Thinking that it would be better to deliver some of my message than none, I went through the charade or reviewing my slide deck with them, being told to remove any reference to “Gaza” or “Palestine” or “Israel” and editing the word “genocide” to “war crimes” until only a single slide that called for “No AI for War Crimes” remained. That is where I drew the line. I was then told that  even displaying that slide was not acceptable and I had to withdraw, a decision they reversed about 10 minutes later, shortly before I took to the stage.

Looking at this year’s keynote and centre stage speakers, an overwhelming number of them came from industry, including Meta, Microsoft, and Amazon. Out of the 82 centre stage speakers, 37 came from industry, compared to five from academia and only three from civil society organisations. This shows that what “good” means in the "AI for Good" summit is overwhelmingly shaped, defined, and actively curated by the tech industry, which holds a vested interest in societal uptake of AI regardless of any risk or harm.

“AI for Good”, but good for whom and for what? Good PR for big tech corporations? Good for laundering accountability? Good for the atrocities the AI industry is aiding and abetting? Good for boosting the very technologies that are widening inequity, destroying the environment, and concentrating power and resources in the hands of few? Good for AI acceleration completely void of any critical thinking about its societal implications? Good for jumping on the next AI trend regardless of its merit, usefulness, or functionality? Good for displaying and promoting commercial products and parading robots?

Any ‘AI for Good’ initiative that serves as a stage that platforms big tech, while censoring anyone that dares to point out the industry’s complacency in enabling and powering genocide and other atrocity crimes is also complicit. For a United Nations Summit whose brand is founded upon doing good, to pressure a Black woman academic to curb her critique of powerful corporations should make it clear that the summit is only good for the industry. And that it is business, not people, that counts.

This is a condensed, edited version of a blog Abeba Birhane published earlier this month. The conference organisers, the International Telecommunication Union, a UN agency, said “all speakers are welcome to share their personal viewpoints about the role of technology in society” but it did not deny demanding cuts to Birhane’s talk. Birhane told Coda that “no one from the ITU or the Summit has reached out” and “no apologies have been issued so far.”

A version of this story was published in the Coda Currents newsletter. Sign up here.

The post AI, the UN and the performance of virtue  appeared first on Coda Story.

No one becomes an anti-corruption activist to make money, least of all in Ukraine. When I first met the co-founders of the Anti-Corruption Action Center – Vitaliy Shabunin and Daria Kaleniuk – back in 2014, they were already veterans of state persecution, and have become only more experienced in the decade since.

AntAC has pioneered and pushed through many of the reforms that have helped Ukraine to become more transparent and less corrupt, leading to the creation of new courts, new laws, new law enforcement agencies, and much more. And this is why it is so alarming that Shabunin has been arrested and his home searched, on the transparently absurd premise that he was dodging military service, while he was following an order from his superior officers to be seconded to the National Agency for Corruption Prevention.

“We strongly believe that, in addition to illegal persecution, these searches are an attempt by the authorities to obtain information about the Anti-Corruption Action Centre’s activities,” said the AntAC. “The goal is simple – to undermine our activities aimed at exposing government corruption.”

It is easy to condemn corruption by your opponents, but sadly easy to excuse it in your friends, particularly in wartime. AntAC’s consistent refusal to go easy on anyone – for example, over the government’s recent refusal to follow the law over the leadership of the Economic Security Bureau of Ukraine – has won it many enemies, but even its critics recognise how central it has been to Ukraine’s democratic development.

“The actions of the pre-trial investigation bodies can be considered either as complete incompetence of officials and unsuitability for their positions, or as a deliberate attack aimed at putting pressure on Vitaliy Shabunin, who continued to criticise the work of state bodies while serving in the military,” said 90 Ukrainian NGOs in a joint statement. 

Western foreign officials need to raise Shabunin’s case with their Ukrainian counterparts and continue raising it until this case is dropped. If Ukraine wants to keep receiving support as a democracy fighting a dictatorship, it needs to keep acting like a democracy, and that means its leaders being willing to hear things they don’t want to hear.

THE U.S., A CRYPTO-POWERED TAX HAVEN?

So the European Union’s Anti-Money Laundering Authority is up and running, and one of its first acts has been to warn about the risk posted by cryptocurrencies in its 2025 work programme. Bruna Szego, AMLA’s chair, added that national regulators need to regulate crypto companies as stringently as they do anything else, and that big crypto companies were likely to be among the 40 institutions that AMLA will directly supervise, along with the continent’s largest banks.

The view from the UK is similar. “The risk of money laundering through cryptoassets has increased significantly since 2020 with cryptoassets increasingly appearing in money laundering intelligence over this period. Cryptoassets are increasingly used for laundering all forms of proceeds of crime,” states the country’s newly-published money laundering risk assessment. “The international nature of the blockchain and cryptoasset transactions present unique difficulties in conducting effective enforcement against criminal actors.”

For anyone with a passing acquaintance with money laundering, all of this is completely non-contentious. However, it is hard to square this caution with what’s happening in the United States. Trump’s own crypto company is expanding its business, U.S. regulators are now cool with retirement accounts holding crypto, and yet another big crypto firm is looking to sell shares on the stock exchange. The technology’s boosters are feeling confident, and presenting blockchain as central to national security.

I see cryptocurrencies as near perfect tools for criminals and tycoons to escape the rules democracies put in place to prevent them from owning everything and bribing everyone. But I can also appreciate the artistry of the efforts of the Digital Chamber to boost its members’ business interests by arguing that they’re for the good of the United States and therefore for the good of humanity (for are those two causes not one and the same?).

“It is TDC’s position that blockchain technology supports global economic freedom by empowering those who resist tyranny around the world,” said the Chamber, one of the biggest crypto lobbyists in Washington, DC.

I don’t know what’s worse: that people say this stuff without believing it, or that they actually believe it. Being able to move money in secret may theoretically empower everyone, but in reality it disproportionately empowers already rich people. The U.S. is turning itself into a blockchain-powered tax haven at any incredible rate. Cartels, kleptocrats, oligarchs, spies, plutocrats, these are the real long-term beneficiaries from cryptocurrencies, and if we don’t realise that soon then the rest of us will pay a heavy price for Washington’s capitulation to their lobbyists.

THE U.K., TWO STEPS FORWARD, ONE STEP BACK

Britain, meanwhile, continues its inch-by-inch progress towards a less dirty financial system. It has dissolved 11,500 companies that did not abide by newer, more stringent rules around transparency, closed three company formation agents, and barred several people from working in corporate formation again. For those of us used to how appallingly lax things used to be, this is all rather good to see, if hard to believe (they do, after all, have previous when it comes to boasting about things they shouldn’t be proud of).

The government is planning a summit on countering illicit finance which, coupled with a surprisingly good-looking series of proposals for getting dark money out of politics, feels weirdly hopeful for a country with a tendency to err on the side of letting dirty cash go wherever it likes. I anticipate that counterbalancing bad news will be along next week.

Still, while I’m being optimistic, I’ll give a shout out to The Latimer Network, which brings together experts and practitioners in countering illicit finance from the U.K. and beyond, with the aim of improving how that is done. One of its particular focuses is on trying to think of a better way of identifying money laundering than the current workhorse: the Suspicious Activity Report (SAR). 

Tens of millions of SARs are filed globally each year, supposedly to alert the authorities to transactions that look dodgy. That is far too many to read, and most of them are valueless anyway, and it would be great to come up with a better way of monitoring transactions, so that criminals are excluded from the financial system. And don’t tell me it’s blockchain.

However, if you’d like an insight into some of the problems facing the British government, here’s a piece I wrote on the absolute disaster that is the national water system. You wouldn’t have thought you could mess up the water supply in a country where it rains so much, and yet, here we are.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The post Ukraine clamps down on anti-corruption activists appeared first on Coda Story.

The numbers are staggering: Meta is offering AI researchers total compensation packages of up to $300 million over four years, with individual deals like former Apple executive Ruoming Pang's $200 million package making headlines across Silicon Valley. Meanwhile, OpenAI just raised $40 billion, with the company valued at $300, reportedly the largest private tech funding round in history. 

But beneath these eye-watering dollar figures lies a profound transformation: Silicon Valley’s elite have evolved from eager innovators into architects of a new world order, reshaping society with their unprecedented power. This shift is not just about money or technology, it marks a fundamental change in how power is conceived and exercised. 

We often talk about technology as if it exists in a silo, separate from politics or culture. But those boundaries are rapidly dissolving. Technology is no longer just a sector or a set of tools; it is reshaping everything, weaving itself into the very fabric of society and power. The tech elite are no longer content with tech innovation alone, they are crafting a new social and political reality, wielding influence that extends far beyond the digital realm.

To break out of these siloed debates, at the end of June we convened a virtual conversation with four remarkable minds: Christopher Wylie (the Cambridge Analytica whistleblower and host of our Captured podcast), pioneering technologist Judy Estrin, filmmaker and digital rights advocate Justine Bateman, and philosopher Shannon Vallor. Our goal: to explore how Silicon Valley’s culture of innovation has morphed into a belief system, one that’s migrated from the tech fringe to the center of our collective imagination, reimagining what it means to be human.

The conversation began with a story from Chris Wylie that perfectly captured the mood of our times. While recording the Captured podcast, he found himself stranded in flooded Dubai, missing a journalism conference in Italy. Instead, he ended up at a party thrown by tech billionaires, a gathering that, as he described in a voice note he sent us from the bathroom, felt like a dispatch from the new center of power:

“People here are talking about longevity, how to live forever. But also prepping—how to prepare for when society gets completely undermined.”

At that party, tech billionaires weren’t debating how to fix democracy or save society. They were plotting how to survive its unraveling. That fleeting moment captured the new reality: while some still debate how to repair the systems we have, others are already plotting their escape, imagining futures where technology is not just a tool, but a lifeboat for the privileged few. It was a reminder that the stakes are no longer abstract or distant: they are unfolding, right now, in rooms most of us will never enter.

Our discussion didn’t linger on the spectacle of that Dubai party for long. Instead, it became a springboard to interrogate the broader shift underway: how Silicon Valley’s narratives, once quirky, fringe, utopian, have become the new center of gravity for global power. What was once the domain of science fiction is now the quiet logic guiding boardrooms, investment strategies, and even military recruitment.

As Wylie  put it, “When you start to think about Silicon Valley not simply as a technology industry or a political institution, but one that also emits spiritual ideologies and prophecies about the nature and purpose of humanity, a lot of the weirdness starts to make a lot more sense.”

Judy Estrin, widely known in tech circles as the "mother of the cloud" for her pioneering role in building the foundational infrastructure of the internet, has witnessed this evolution firsthand. Estrin played a crucial part in developing the TCP/IP protocols that underpin digital communication, and later served as CTO of Cisco during the internet’s explosive growth. She’s seen the shift from Steve Jobs’ vision of technology as "a bicycle for the mind" to Marc Andreessen’s declaration that "software is eating the world." 

Now, Estrin sounds the alarm: the tech landscape has moved from collaborative innovation to a relentless pursuit of control and dominance. Today’s tech leaders are no longer just innovators, they are crafting a new social architecture that redefines how we live, think, and connect.

What makes this transformation of power particularly insidious is the sense of inevitability that surrounds it. The tech industry has succeeded in creating a narrative where its vision of the future appears unstoppable, leaving the rest of us as passive observers rather than active participants in the shaping of our technological destiny.

Peter Thiel, the billionaire investor and PayPal co-founder, embodies this mindset. In a recent interview, Thiel was asked point-blank whether he wanted the human race to endure. He hesitated before answering, “Uh, yes,” then added: “I also would like us to radically solve these problems…” Thiel’s ambivalence towards other human beings and his appetite for radical transformation capture the mood of a class of tech leaders who see the present as something to be escaped, not improved—a mindset that feeds the sense of inevitability and detachment Estrin warns about.

Estrin argues that this is a new form of authoritarianism, where power is reinforced not through force but through what she calls "silence and compliance." The speed and scale of today's AI integration, she says, requires us " to be standing up and paying more attention." 

Shannon Vallor, philosopher and ethicist, widened the lens. She cautioned that the quasi-religious narratives emerging from Silicon Valley—casting AI as either savior or demon—are not simply elite fantasies. Rather, the real risk lies in elevating a technology that, at its core, is designed to mimic us. Large language models, she explained, are “merely broken reflections of ourselves… arranged to create the illusion of presence, of consciousness, of being understood.”

The true danger, Vallor argued, is that these illusions are seeping into the minds of the vulnerable, not just the powerful. She described receiving daily messages from people convinced they are in relationships with sentient AI gods—proof that the mythology surrounding these technologies is already warping reality for those least equipped to resist it.

She underscored that the harms of AI are not distributed equally: “The benefits of technological innovation have gone to the people who are already powerful and well-resourced, while the risks have been pushed onto those that are already suffering from forms of political disempowerment and economic inequality.” 

Vallor’s call was clear: to reclaim agency, we must demystify technology, recognize who is making the choices, and insist that the future of AI is not something that happens to us, but something that we shape together.

As the discussion unfolded, the panelists agreed: the real threat isn’t just technological overreach, but the surrender of human agency. The challenge is not only to question where technology is taking us, but to insist on our right to shape its direction, before the future is decided without us.

Justine Bateman, best known for her iconic roles in Hollywood and her outspoken activism for artists’ rights, entered the conversation with the perspective of someone who has navigated both the entertainment and technology industries. Bateman, who holds a computer science degree from UCLA, has become a prominent critic of how AI and tech culture threaten human creativity and agency.

During the discussion, Bateman and Estrin found themselves at odds over how best to respond to the growing influence of AI. Bateman argued that the real threat isn’t AI itself becoming all-powerful, but rather the way society risks passively accepting and even revering technology, allowing it to become a “sacred cow” beyond criticism. She called for open ridicule of exaggerated tech promises, insisting, “No matter what they do about trying to live forever, or try to make their own god stuff, it doesn’t matter. You’re not going to make a god that replaces God. You are not going to live forever. It’s not going to happen.” Bateman also urged people to use their own minds and not “be lazy” by simply accepting the narratives being sold by tech elites.

Estrin pushed back, arguing that telling people to use their minds and not be lazy risks alienating those who might otherwise be open to conversation. Instead, she advocated for nuance, urging that the debate focus on human agency, choice, and the real risks and trade-offs of new technologies, rather than falling into extremes or prescribing a single “right” way to respond.

“If we have a hope of getting people to really listen… we need to figure out how to talk about this in terms of human agency, choice, risks, and trade-offs,” she said. “Because when we go into the , you’re either for it or against it, people tune out, and we’re gonna lose that battle.”

At this point, Christopher Wylie offered a strikingly different perspective, responding directly to Bateman’s insistence that tech was “not going to make a god that replaces God.”

“I’m actually a practicing Buddhist, so I don’t necessarily come to religion from a Judeo-Christian perspective,” he said, recounting a conversation with a Buddhist monk about whether uploading a mind to a machine could ever count as reincarnation. Wylie pointed out that humanity has always invested meaning in things that cannot speak back: rocks, stars, and now, perhaps, algorithms. “There are actually valid and deeper, spiritual and religious conversations that we can have about what consciousness actually is if we do end up tapping into it truly,” he said.

Rather than drawing hard lines between human and machine, sacred and profane, Wylie invited the group to consider the complexity, uncertainty, and humility required as we confront the unknown. He then pivoted to a crucial obstacle in confronting the AI takeover:

“We lack a common vocabulary to even describe what the problems are,” Wylie argued, likening the current moment to the early days of climate change activism, when terms like “greenhouse gases” and “global warming” had to be invented before a movement could take shape. “Without the words to name the crisis, you can’t have a movement around those problems.”

The danger, he suggested, isn’t just technological, it’s linguistic and cultural. If we can’t articulate what’s being lost, we risk losing it by default.

Finally, Wylie reframed privacy as something far more profound than hiding: “Privacy is your ability to decide how to shape yourself in different situations on your own terms, which is, like, really, really core to your ability to be an individual in society.”

When we give up that power, we don’t just become more visible to corporations or governments, we surrender the very possibility of self-determination. The conversation, he insisted, must move beyond technical fixes and toward a broader fight for human agency.

As we wrapped up, what lingered was not a sense of closure, but a recognition that the future remains radically open—shaped not by the inevitability of technology, but by the choices we make, questions we ask, and movements we are willing to build. Judy Estrin’s call echoed in the final moments: “We need a movement for what we’re for, which is human agency.”

This movement, however, should not be against technology itself. As Wylie argued in the closing minutes, “To criticize Silicon Valley, in my view, is to be pro-tech. Because what you're criticizing is exploitation, a power takeover of oligarchs that ultimately will inhibit what technology is there for, which is to help people.” 

The real challenge is not to declare victory or defeat, but to reclaim the language, the imagination, and the collective will to shape humanity's next chapter.

A version of this story was published in last week’s Sunday Read newsletter. Sign up here.

The post Who decides our tomorrow? Challenging Silicon Valley’s power appeared first on Coda Story.

I’m sure I’m not the only person who secretly likes a one-star review. It’s awful to get one yourself (and I have, several times), but I have to admit that there is a nasty kind of pleasure to be had from reading at length how someone else’s restaurant, film, album or book is awful. So, if you’re that kind of person too, I recommend you dive into “How Well Does the Money Laundering Control System Work?”, a spectacularly critical if scrupulously academic article by Mirko Nazzari and Peter Reuter.

At the risk of giving away the punchline: the short answer to the question in the title is “it doesn’t”. Although, there are also additional details about how the anti-money laundering (AML) system acts as a moat around big banks to protect them from competition, while raising the costs of banking for everyone, excluding vulnerable and marginalised people from the financial system altogether, and doing nothing to stop criminals from keeping their wealth. So perhaps the answer is more like “not only does it not work, but it actively makes the problem it’s purporting to solve significantly worse”.

Of many damning examples that Nazzari and Reuter pick out, perhaps the most striking is how the Financial Action Task Force “grey-listed” South Sudan in 2021 for its failure to meet the FATF’s standards, at a time when the country’s very existence was threatened by civil war and humanitarian crisis. The idea that anyone would choose to launder significant amounts of money through a state without any effective government or legal apparatus is absurd, yet the FATF went ahead and imposed limitations on its ability to access banking services anyway, thus further crippling an already fragile economy and worsening a humanitarian catastrophe.

“It is hard for anyone to defend the current system with enthusiasm. Its failure to reduce either the predicate crimes that generate large criminal revenues or the volume of money laundering is uncontested. Even though specific estimates of costs are lacking, no one doubts that those costs are in the hundreds of billions of dollars globally,” Reuter and Nazzari write. “Government claims of success often appear ritualistic and are seldom scrutinized in detail. Yet, for all that, there is hardly any discussion of fundamental reforms in any country.” 

I have been, as regular readers will know, writing a book on this precise topic and it is very pleasing that two distinguished researchers have come to exactly the same conclusions that I came to. I have also recently published an article about how the cryptocurrency tether is a dream tool for criminals looking to evade restrictions, and it is just one of many similar financial innovations that are rendering the AML system an ever-deader duck. 

TURNING A BLIND EYE

On one level this is bad, because anything that makes it easier and cheaper for criminals to keep their money is awful. But on another level, if it was already easy and cheap for criminals to keep their money, perhaps the existential threat to the tattered remnants of the AML system that is posed by crypto gives us an opportunity to design a new system that does better. It is after all a very important challenge.

“All elements of our security are supported by our ability to tackle illicit finance – the flows of funds from criminal activity that underpin threats to the U.K. including terrorist networks, serious and organised crime groups, and hostile state actors,” claims the government’s brand new national security strategy.

Part of the difficulty of trying to persuade politicians of the urgency of improving the AML system is the sheer volume of jargon involved. But you don’t need acronyms to explain why this matters: money buys power; the more money criminals, terrorists and spies have, the more powerful they will be; powerful criminals, terrorists and spies are bad; so do something about it; the end. Of course, taking on the rich and powerful requires political determination and a belief in democracy, which is a whole different challenge.

“Foreign agents are watching as America’s anti-corruption regime crumbles. They see an extraordinary window of opportunity, and they know they’ll have to act quickly to take full advantage,” writes Casey Michel in this hugely alarming article (there’s something about seeing everything put together in one place). “Foreign regimes are beginning to see just how far their money can go in Trump’s America.”

FRIENDS IN HIGH PLACES

Of course, having an effective AML system also relies on banks abiding by the rules that are imposed upon them, which is tricky because there’s money to be made if you welcome in customers that other institutions are excluding. And that brings us to Monzo, an online bank which gained a full British license in April 2017, and now has around 12 million customers and is valued at several billion pounds. It appeared to have some pretty high-prestige customers, considering some of them registered their addresses as “Buckingham Palace” and “10, Downing Street”, but it appears they were not being entirely truthful. Monzo was not providing bank services to the king or the prime minister, but was instead not doing basic checks on the veracity of its clients’ information. 

“Monzo’s failure to gather sufficient customer data meant that the Firm was unable effectively to assess whether transactions were consistent with expected activity or were suspicious. In addition, there were weaknesses in Monzo’s transaction monitoring processes,” noted the Financial Conduct Authority last week, as it fined the bank 21 million pounds. Monzo is a small bank, with a tiny fraction of the assets of an HSBC or a Barclays, but I’m going to go out on a limb and say it has almost certainly laundered more money internationally than South Sudan. 

Yet, the chances of Britain being grey-listed are nil. Perhaps the biggest flaw in the world’s AML system is that it’s a cosy club of rich countries who are all very forgiving of each other’s slips and foibles, but very willing to condemn others. Somewhere that’s perhaps deserving of more condemnation is Liechtenstein, which has an unfortunately-named zombie trust crisis, caused by suddenly imposing sanctions on a financial system that had previously been very happy to provide services to wealthy Russians if not, as far as I know, to actual zombies.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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I am a regular listener to Ezra Klein’s podcast, and I’m a fan. There should be more podcasts that treat serious issues seriously, but there’s something he said back in April when talking about the root cause of problems on the Left of politics that has concerned me since I heard it. “It’s not just the fault of money in politics, because there’s money on all sides of the issues. There’s something else going on,” he said.

That concerned me because it encapsulated a mistake that’s often made about why political funding is problematic. It’s often assumed that the only problem is that rich people can buy support for an issue they care about, so it’s therefore often missed – as Klein did – that a far bigger problem is that they define what is considered an issue in the first place.

You could look at the fact that billionaires supported both Republicans and Democrats in last year’s presidential election (although far more money went to Republicans), and conclude that – since both sides got money – it’s not a big deal. Or you could wonder which issues don’t get attention because no one with money is interested in them being discussed.

Five years ago, when I’d just started writing this newsletter, I made a big thing out of the fact that three people owned more than $100 billion. Centi-billionaires were new back then, but they’re old hat these days. Some 18 people have passed that threshold now, and more will be along to join them very soon. Oxfam predicts there will be five trillionaires by the end of the decade, and that was before Donald Trump’s tax cuts were passed by Congress.

Last year, here in the U.K., it looked like Keir Starmer actually understood the importance of protecting politics from the corrupting effect of money, but he’s failed to actually follow through. “Time and again, Labour’s warm words about cleaning up politics have not translated into action. Rather than rebuilding faith in democracy, Starmer’s listlessness risks eroding it even further,” wrote the journalist Peter Geoghegan last week.

Meanwhile, over in France, billionaire wealth has already nosed its way into politics and is helping to raise the profile of the Far Right. 

“Media groups, at the hands of a few powerful men,” wrote one observer late last year, “are actively shaping the political discourse in a way that normalises far-right narratives and talking points. By giving disproportionate airtime to far-right figures and framing their extremist positions as legitimate responses to France’s social and economic challenges, these media outlets are gradually shifting public opinion.”

It's a sign of this shift in opinion that the asset manager Aberdeen (fresh from cancelling a rebrand to ‘abrdn’, which cost an estimated £500,000) has decided to sack the independent board of the Financial Fairness Trust, which has supported organisations researching the effects of inequality. A few years ago, that kind of philanthropy was a cheap way to look like the kind face of capitalism. These days, I’m not sure anyone cares.

Back when I was a cub reporter, an old-timer gave me some advice: “don’t write about process, nobody cares about process, write about results”. It’s good advice for someone trying to write articles, but it’s bad advice more broadly, because process is important. The process of drafting regulation is when laws get defined; the process of crafting the rules that will guide the implementation of laws is when questions get resolved. The power of billionaires is that they can afford to employ people to monitor that process, and to make suggestions. If the rest of us don’t care, the world will be stolen from us without any of us noticing.

And once it’s stolen, it’ll stay stolen. Thanks to impenetrable financial structures like a trust registered in South Dakota, the super-rich can keep their wealth safe in perpetuity. When I first wrote about South Dakotan trusts, back in 2019, there was around $350 billion squirreled away in the Mount Rushmore State. That total has now hit $815 billion, having risen by $100 billion in the last year alone.

“It’s going to go on for—the estimates vary — 10 to 15 more years. But, there’s a huge transfer underway from the boomer generation to the next generation," said Bret Afdahl, the director of the state’s Banking Division.

Sometimes it can be hard to stay optimistic.

THE IMAGINARY BANKER

Here’s a weird story: “meet Barbarat Giuseppe, the world’s most prolific banker. He’s run most of the world’s largest banks … Mr Giuseppe’s spectacular career is spoilt only by the small detail that it’s all fraudulent”.

Guiseppe may not actually exist, but he’s been able to create a series of U.K.-registered companies with the same name as major financial institutions: UBS, Goldman Sachs, and so on. When he’s been caught, he’s just created new familiar-sounding companies, perhaps as part of a money laundering scheme, though it’s not immediately clear how it would help.

“We need to see prosecutions. Skip the hard stuff of finding victims of fraud. Do an “Al Capone” and prosecute the easy offences instead,” writes Dan Neidle’s Tax Policy Associates. Amen to that.

It’s a story that shows that, despite attempted reforms, there are still major problems with many aspects of the U.K.’s company formation system. “The foundations for a successful regime are now in place, however it will take a concerted effort from across the economic crime architecture to deliver results,” wrote Transparency International’s Ben Cowdock.

RUSSIA’S BLOCKCHAIN BET

Last week, I wrote about how Russia was moving money via crypto and Kyrgyzstan to evade Western restrictions on its financial sector, and here’s an interesting analysis of the phenomenon. “Russia is building a parallel financial system using blockchain as its backbone,” writes analysts from Astraea. “This network presents a growing challenge for regulators and underscores the urgency of developing coordinated international responses to crypto-based sanctions evasion.” 

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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There are cities that teach you to read between the lines, to notice the way the air shifts before history changes course. Beirut in 2008 was one of those cities. A familiar cast filled its glitzy bars and air conditioned coffee shops: correspondents, fixers, schemers, dreamers – but beneath the surface, the city was still reeling from the earth-shattering assassination in 2005 of its former prime minister Rafic Hariri. Beirut was caught between recovery and reckoning, not yet knowing that the region's biggest earthquake was still gathering force just across the border.

It was in this world that I found myself, the latest addition to the city's English-speaking press corps. I had landed as the BBC's correspondent, but unlike most of my on-air colleagues at the time, I had an accent no one could quite place and a backstory most of my fellow foreign correspondents would have struggled to map. Except for Ghaith Abdul-Ahad, the other accented foreigner in Beirut's lively foreign correspondents group.

In Beirut, like all foreign correspondents Ghaith and I were outsiders to the country we were reporting on, but we were also outsiders trying to break into an industry that was reluctant to accept us. I remember at one particularly loud Beirut media party, a middle-aged man shouted into my ear that the new BBC correspondent's accent was a disgrace, an act of disrespect to British listeners. He didn't realize he was speaking to that very correspondent. 

Ghaith meanwhile had made his way from an architecture school in Baghdad (evident in the skill he brings to his sketches) onto the pages of The Guardian, somehow transforming the drawbridge of the British media establishment into an open door.  But it wasn’t our struggle that we bonded over – it was bananas. Or, more precisely, the scarcity thereof.

In Saddam’s Iraq, I learned from Ghaith, much like in the Soviet Georgia of my childhood, the lack of bananas turned them into more than a fruit. They were a symbol of luxury, a crescent-shaped promise that somewhere life was sweet and abundant. Most kids like us, who grew up dreaming of bananas, set out to chase abundance in Europe or America as adults. For whatever reasons, Ghaith and I chose the reverse commute, drawn to the abundance of stories in places that others wanted to flee. 

Ghaith and I decided to turn our community of two into a secret club we called “Journalists Without Proper Passports”: JPP, or was it JwPP. We couldn’t quite agree on the acronym, but it became a running joke about the strange calculus of turning what you lack into what you offer. Our passports, while pretty useless for weekend trips to Europe or getting U.S. visas, worked miracles for getting into places like Libya, Yemen, Uzbekistan, Burma, and Iran.

On a trip to Afghanistan, Ghaith left his Beirut apartment keys with a fresh face who had just arrived in the city: Josh Hersh. Josh, I only recently learned, had been agonizing over whether he should move from New York to Beirut, coming up with excuse after excuse not to make the leap. "In April, I'm gonna be in Afghanistan," Ghaith had told him when they met. "You can stay in my apartment, no problem." Just like that, Josh had no more excuses. And so, while Ghaith was in  Afghanistan, Josh was settling into Beirut's rhythm, discovering what the rest of us already knew: that the city had a way of making you feel like you belonged, even when you clearly didn't.

Josh had a keen reporter’s eye for things the rest of us missed. I remember one night at Barometre – a sweaty, crowded Palestinian bar where men spun in circles to music that seemed to defy gravity – Josh and I slipped outside for air. He pointed at my beer and said, "You aren't really drinking that, are you?" Just like that, he'd guessed my secret: I was pregnant. That was Josh's gift – listening and watching harder than anyone else, catching the detail that unlocks the rest of the story.

The gift was on full display when, almost two decades after they met, Ghaith and Josh sat down in Tbilisi at ZEG, our annual storytelling festival. Josh was interviewing Ghaith at ZEG for Kicker, his podcast for Columbia Journalism Review.

The conversation happened at a moment when the Middle East was literally on the brink of a wider war. The old fault lines – sectarian, geopolitical, generational – were shifting beneath our feet. And Ghaith's words felt both urgent and timeless, a reminder that beneath every headline about good guys and bad guys are people making desperate choices about survival. Unlike many of us, who eventually scattered to desk jobs at a comfortable distance from the action, Ghaith is still the one regularly slipping into Damascus and Sana’a, telling stories that – as Josh put it “refuse to moralize”, to categorize people as heroes or traitors, insisting instead on the messy, human reality of survival. 

At ZEG, he talked about Mustafa, a young man in Damascus who became a "reluctant collaborator" with the Syrian regime – not out of ideology, but out of a desperate calculus for survival. "My rule number one: I will never be beaten up ever again," Ghaith recounted Mustafa saying. "And of course, he gets beaten up again and again and again." It's a line that lands with particular force now, as the region cycles through yet another round of violence, and the world tries once more to flatten its tragedies into headlines.

Ghaith also spoke about the legacy of violence that shapes the region's present – and its future: "That's the legacy, the trauma of violence, that is the biggest problem in this region, I think. It is an organic reason why these cycles perpetuate themselves."

And then there was his insight into how the West – and the world – misunderstands the Middle East: "At one point, I realized there is no one conflict crossing the region from Tehran to Sana'a via Baghdad and Damascus. But a constellation of smaller conflicts utilized for a bigger one… It's so much easier to understand the conflict in the Middle East as Iran versus the Sunnis or the Jihadis versus Israel. But if we see it as a local conflict, I think it's much more difficult, but it's much more interesting."

"My anger with Americans is not only destroying Iraq, not only committing massacres and whatnot, and not a single person went to jail for the things they did in Iraq. Not George Bush. Not Nouri al-Maliki. No one has ever stood and said, well, I'm sorry for the things we've done. We will never have a proper reconciliation because the same trauma of violence and sectarianism will be repackaged and will travel to Syria, to Yemen and come back to haunt this region. And that's my problem. And this is why I'm angry."

Josh, with his characteristic gentleness, pressed Ghaith on these patterns and the craft of reporting on them. And Ghaith, ever the reluctant protagonist, brushed aside the idea of bravery: "I'm scared all the time. Not sometimes, but all the time. But also, I think it's not about me. I want to tell the story of Mustafa, of the other people on the ground. I don't want to be distracted by my own story, reading “War and Peace” in a Taliban detention cell."

When the session ended, people didn't leave with answers – they left with better questions. There was that electric feeling you get when a conversation has broken something open, when the neat categories we use to understand the world have been gently but firmly dismantled. In that room, for an hour, we weren't talking about "the Middle East" as an abstraction, but about the weight of history on individual lives.

In a moment when the region is once again at the center of the world's anxieties, when the language of "good guys" and "bad guys" is being weaponized by everyone from politicians to algorithms, we need conversations that refuse to let us off the hook. We need the kind of journalism that Ghaith practices, journalism that insists on the messy, contradictory reality of people's lives, that sees the individual inside the collective tragedy.

A version of this story was published in last week’s Sunday Read newsletter. Sign up here.

Listen to the full conversation on The Kicker. If you're curious about the stories that shaped it, pick up Ghaith's book, and join us at the next ZEG, where the best conversations are always the ones you didn't expect to have.

The post What We Miss When We Talk about the “Middle East” appeared first on Coda Story.

When I lived in Bishkek 25 years ago, then-president Askar Akayev was so effusive in expressing his desire for Kyrgyzstan to become the Switzerland of Central Asia that the Swiss ambassador once joked that Akayev liked his homeland better than he did. 

It was a pretty understandable hope - who wouldn’t want their poor ex-Soviet republic to become as prosperous and stable as Switzerland? – but it was a forlorn one. Both countries are multilingual and mountainous, but have little else in common. In the end, Akayev fled to Russia, his fall precipitated by the Tulip Revolution. He was the first of three presidents to be chased out of office, only for each new government to be every bit as corrupt and incompetent as those that were overthrown. 

But will it be sanctions-dodging that finally brings Kyrgyzstan and Switzerland together? There is already substantial transhipment of physical goods via Kyrgyz companies to help Russians access goods they’re supposedly barred from purchasing, including luxury cars, but the business appears to be becoming more elaborate.

A GOLDEN OPPORTUNITY

Back in April, the former Binance CEO Changpeng “CZ” Zhao (he stepped down after being jailed in the US, but still owns most of the company) announced that he was advising Kyrgyzstan on crypto reforms. “Such initiatives are crucial for the sustainable growth of the economy and the security of virtual assets, ultimately generating new opportunities for businesses and society as a whole,” said current president Sadyr Zhaparov at the time.

In May, we heard that Kyrgyzstan plans to launch a dollar-pegged stablecoin called USDKG which, fascinatingly, will be backed not – as it is at Tether (USDT) or Circle – with dollar assets, but with $500 million worth of gold from the Kyrgyz government.

“Anyone holding USDKG can redeem it for physical gold in Kyrgyzstan, exchange it for crypto like USDT, or withdraw it as fiat through the traditional banking system,” said William Campbell, who is advising the government in Bishkek on the venture. 

Apparently, the aim is for the cryptocurrency to be used for remittances back to Kyrgyzstan from citizens abroad, as well as legal tender inside the country, but it also looks like an open invitation to money laundering and sanctions dodging. If USDKG works the way he says it will, it will be a state-approved backdoor linking the gold market, the traditional financial system, and the crypto world. It would be in short a 21st-century version of what Switzerland used to be for Nazis, dictators, mafiosi, spies and tax-dodgers, before the rest of the world forced it to go straight (ish).

Last week, the FT published a fascinating investigation into how a fugitive Moldovan oligarch and a Russian bank have created a rouble-backed stablecoin called A7A5, which they are trading in Kyrgyzstan, effectively to gain access to USDT, which they lost when the Garantex exchange was shut under U.S. pressure in March.

“(It is a) friendly jurisdiction that is not so subject to sanctions”, said A7A5’s director Leonid Shumakov. “It is no secret that this jurisdiction is currently helping a lot to cope with the pressure [Russia] is under.”

Earlier this year, the United States sanctioned a Kyrgyz bank that it suspected was trying “to create a sanctions evasion hub for Russia to pay for imports and receive payment for exports”. But it’s not clear what it can do about a stablecoin if it has no connection to the U.S. financial system and therefore no reason to fear the Department of the Treasury.

History shows that when a sufficiently large number of rich people or companies become discontented by government restrictions on what they can do with their money, they will find a jurisdiction willing to earn fees by helping them evade those obstacles. This is how places as varied as Hong Kong, Dubai, the Cayman Islands and Delaware earn a living, and it would not be a surprise if Kyrgyzstan were to join them.

SHEDDING LIGHT ON THE DARK ECONOMY

Britain of course is the granddaddy of all the tax havens, so it’s heartening to see evidence that reforms to try to clean up its rotten financial system are starting to have some effect. In 2023, parliament passed a law to prevent British companies from being quite so perfect a vehicle for the committing of financial crimes, and the corporate registry has issued a progress report.

Highlights include the fact that tens of thousands of fraudulent companies have been struck off the register, many other companies have been forced to update their information to make it accurate, and attempts to create companies with false information have been prevented. Applicants are going to have to verify their identity before they file information, but will also have the right to prevent that information becoming public if it would pose a risk to themselves.

It wasn’t long ago that Companies House was the preferred source for cheap, reliable shell companies used in money laundering scandals globally. And it is genuinely brilliant that efforts are being made to prevent that from happening again (although there is still a long way to go).

It’s interesting as well that UK law enforcement agencies are trying to build ties with foreign counterparts in order to tackle corruption and financial crime, not least since they appear to be trying to encourage American agencies not to retreat from the fight. It will of course take more than a few nice words from the Brits to enthuse Donald Trump’s White House about the merits of fighting corruption, particularly considering the number of attorneys tackling investigations under the Foreign Corrupt Practices Act appears to have been halved.

While on the subject of international cooperation, here’s an interesting paper about the effect on a bank in the Isle of Man of the automatic exchange of information, which was brought in after the 2007-8 financial crisis to make it harder for people to dodge tax. Its analysis is based on leaked data and only covers one relatively small bank in one relatively small jurisdiction, but appears to reveal some pretty significant flaws in the regulations, which may make them less effective than we’d hoped.

And while on the subject of tax havens, the British Virgin Islands has issued proposals for how it might make its corporate registry less opaque, and they are not great. “Most alarmingly,” said Transparency International’s Margot Mollat, “the policy of notifying company owners when their information is accessed puts journalists and civil society actors at serious risk of retaliation and legal intimidation.” This isn’t transparency, Mollat added, “it’s a system that will frustrate scrutiny and protect dirty money”. 

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The post Crypto’s backdoor through Bishkek appeared first on Coda Story.

Earlier this week, as the Iranian defense minister headed to Qingdao for a Shanghai Cooperation Organization summit, Donald Trump was basking in the spotlight at a NATO gathering in the Netherlands, claiming credit for brokering a Middle East truce. But beneath the headlines, one untold story was about who gets to shape the new world order, and how Russia, once a regional kingmaker, is now struggling to define its place.

As old alliances crack, Russia is scrambling to shape a new global order. Its answer: an unexpected bold imperial narrative that promises stability but reveals deep anxieties about Moscow’s place in a world where legitimacy, history, and power are all being contested.

The Iranian defense minister’s trip to Qingdao - his first foreign visit since the ceasefire with Israel - was meant to signal solidarity within the Shanghai Cooperation Organization, a block that includes Russia, India, and Pakistan. But the SCO, despite its ambitions, could only muster a joint statement of “serious concern” over Middle East tensions when Iran was being bombed by Israel - a statement India refused to sign. This exposed the stark limits of alternative alliances and the growing difficulty of presenting a united front against the West. In Qingdao, Andrei Belousov, the Russian defense minister, warned of “worsening geopolitical tensions” and “signs of further deterioration,” a statement that’s hard to argue with.  

Meanwhile, in the Netherlands, Trump relished his role as global peacemaker, claiming credit for an uneasy Israel-Iran truce - a truce that Russia welcomed while being careful to credit Qatar for its diplomatic efforts. Russia itself reportedly played a supporting role alongside Oman and Egypt. But the real diplomatic heavy lifting was done by others - and Russia’s own leverage  was exposed as limited. 

Once the region’s indispensable power broker, Moscow found itself on the sidelines. Its influence with Tehran diminished, and its air defense systems in Iran—meant to deter Israeli and later American strikes—were exposed as ineffective. With Bashar al-Assad’s rule in Syria collapsed, the Kremlin is acutely aware it cannot afford to lose another major ally in the region. As long as the Iranian government stands, Russia can still claim to have a role to play, but its ability to project power in the Middle East is now more symbolic than real. The 12-day war put Russia in an awkward position. Iran, a key supplier of drones for Russia’s war in Ukraine, was unimpressed by Moscow’s lack of support during the crisis. Even after signing a 20-year pact in January, Russia offered little more than “grave concern” when the bombs started falling. Similarly to the SCO, BRICS, supposedly the alternative to Western alliances, could only issue a joint statement, revealing just how thin multipolarity is in practice.

Enter the new narrative spin

For years, Vladimir Putin has argued that the West’s “rules-based order” is little more than a tool for maintaining Western dominance and justifying double standards. His vision of multipolarity is not just anti-American rhetoric—it’s a deliberate strategy to appeal to countries disillusioned by Western interventions, broken promises, and the arrogance of those who claimed victory in the Cold War. Russia has worked to turn Western failures—from Iraq to Afghanistan, from Libya to the global financial crisis—into recruitment tools for its own vision of “civilizational diversity.” Multipolarity, in the Kremlin’s telling, is about giving every culture, every nation, a seat at the table, while quietly reserving the right to redraw the map and rewrite the rules when it suits Moscow’s interests.

For a time, this approach was paying off. Russia’s anti-colonial and multipolar rhetoric resonated well beyond its borders, particularly in the Global South and among those frustrated by Western hypocrisy. 

But across the periphery of Russia’s historical empire, from Central Asia to the Baltics, from the Caucasus to Ukraine and Georgia, Russia’s multipolar message is seen not as liberation but as yet another chapter in a centuries-long cycle of conquest, repression and forced assimilation - a reality that continues to define the struggle for self-determination across Russia’s former empire.  Here, Russia’s message of “sameness” has long served as a colonial tool, erasing languages, cultures, and identities in the name of imperial unity. 

The recent conflict in the Middle East has forced Moscow to adapt its “multipolarity” messaging yet again. As its limitations as a regional power became impossible to ignore, Russian state media and officials began to reframe the conversation—no longer just championing multipolarity, but openly embracing the language of empire. In this new narrative, ‘empire’ is recast not as a relic of oppression, but as a stabilizing force uniquely capable of imposing order on an unruly world. The pivot is as much about masking diminished leverage as it is about projecting confidence: if Moscow can no longer dictate outcomes, it can still claim the mantle of indispensable power by rewriting the very terms of global legitimacy.

As we peered into the abyss of World War III, Russian state media pivoted: suddenly, ‘empire’—long a slur—was rebranded as a stabilizing force in a chaotic world.

This rhetorical shift has been swift and striking. Where once the Kremlin denounced imperialism as a Western vice, Russian commentators now argue that empires are not only inevitable but necessary for stability. “Empires could return to world politics not only as dark shadows of the past. Empire may soon become a buzzword for discussing the direction in which the world’s political organization is heading,” wrote one Russian analyst. The message is clear: in an age of chaos and fractured alliances, only a strong imperial center—preferably Moscow—can guarantee order. But beneath the surface, this embrace of empire reveals as much uncertainty as ambition, exposing deep anxieties about Russia’s place in a world it can no longer control as it once did.

Inside Russia, this new imperial rhetoric is both a rallying cry and a reflection of unease. In recent weeks, influential analysts have argued that Iran’s restraint—its so-called “peacefulness”—only invited aggression, a warning that resonates with those who fear Russia could be next. Enter Alexander Dugin, the far-right philosopher often described as “Putin’s brain,” whose apocalyptic worldview has shaped much of the Kremlin’s confrontational posture. Dugin warns that if the U.S. and Israel can strike Tehran with impunity, nothing would stop them from finding a pretext to strike Moscow. This siege mentality, echoed by senior officials, is now being used to justify a strategy of escalation and deterrence at any cost.

Dugin’s views were echoed by Konstantin Kosachev, chair of the Russian parliamentary foreign affairs committee: “If you don’t want to be bombed by the West, arm yourself. Build deterrence. Go all the way—even to the point of developing weapons of mass destruction.”

But for all the talk of “victory,” by all sides post the 12-day war,  the outcomes remain ambiguous. Iran insists its nuclear ambitions are undimmed. While Israel and Trump’s team says Iran is further from a bomb than ever before – still, the facts are murky and the region is no closer to peace. As one Russian analyst remarked, the normalization of “phoney war” logic means that everyone is arming up, alliances are transactional, and the rules are made up as we go along.

If the only lesson of the 12-day war is that everyone must arm themselves to the teeth, we’re not just reliving the Cold War—we’re entering a new era of empire-building, where deterrence is everything and the lines between friend and foe are as blurred as ever.

In a world where old alliances crumble and new narratives emerge, the true battle, it seems, is not just over territory or military might, but over the stories that define power itself. Russia’s pivot to an imperial narrative reveals both its ambitions and its anxieties, highlighting a global order in flux where legitimacy is contested and the rules are rewritten in real time. Understanding this evolving empire game is essential to grasping the future of international relations and the fragile balance that holds the world together.

A version of this story was published in this week’s Coda Currents newsletter. Sign up here.

Research and additional reporting by Masho Lomashvili.

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The post The Empire Game 2.0: Through Moscow’s Eyes appeared first on Coda Story.

Years of sanctions have substantially weakened the Iranian economy, as evidenced by Iran’s keenness to have them cancelled, with sanctions removal a key sticking point in negotiations with the U.S. before Israel began bombing Iranian nuclear sites on June 13. But anyone who thinks sanctions are an all-powerful tool should spend some time speaking to Tehran businessmen. The exchange houses in the bazaar in Tehran can arrange money transfers to and from anywhere you like, no matter what the Office of Foreign Assets Control says.

It’s all coordinated via encrypted messaging apps and, as long as you’re transacting with a major centre like London, Paris or New York, your cash will be ready for collection within a couple of hours. “You can get paid electronically if you have a bank account. You need to be a bit careful about having lots of random payments coming into your account, but otherwise it’s straightforward,” one Iranian told me.

The trick is the same one used at various times and on various continents in Chinese Underground Banking, hawala transfers, or the Black Market Peso Exchange, all of which also exist to provide financial services outside the Western-dominated financial system. Instead of moving money electronically through bank accounts, they transfer value through the trade network, something that Western policy makers really struggle to get a grip of, not least because they often don’t understand what’s going on.

A DIGITAL ACT OF WAR

Cryptocurrencies have really supercharged these networks because, instead of moving value in a shipload of used cars or a container of designer handbags, which take weeks to reach their final destination and are cumbersome to buy, move and sell, they can be shifted quickly, easily and with minimal time delay. Hawaladars can now shift value between countries with their phones, and the sarafis in Tehran are all using Tether, despite the fact they’re not supposed to (I mean, neither are Venezuelans, but that hasn’t stopped the national oil company).

This is why last week’s hack by the Israel-linked group Predatory Sparrow (who are presumably unrelated to calypso king Mighty Sparrow, but I’ll take any excuse to link to this banger) is so interesting. By raiding $90 million from Tehran’s Nobitex crypto exchange it was striking a blow against the informal financial ties between Iranians and the rest of the world. The lost cryptocurrencies included, according to Chainalysis, “Bitcoin, Ethereum, Dogecoin, Ripple, Solana, Tron, and Ton” although the hackers didn’t actually steal them but instead sent them to addresses from which they could not be retrieved, which is a bit like raiding a bank and burning all the currency in its vaults. Elliptic, however, noted that dollar-backed stablecoins may be among the stolen crypto.

Stablecoins are different to other cryptocurrencies in that their value rests on something other than the forces of supply and demand – in Tether’s case, that is the dollar – and the companies that issue them own large stocks of real-world assets to protect the price peg. The strange consequence of this is that while America’s allies use stablecoins to escape the dollar financial system, they are in effect supporting that system by maintaining demand for U.S. Treasuries.

ALL THAT GLITTERS IS CRYPTO

They are not entirely happy about this, which is why they have been investing so heavily in the other great reserve asset: gold, the price of which has hit high after high after high this year. And this raises the fascinating prospect of a gold-backed stablecoin taking off, giving all the advantages of Tether but without having to support the U.S. government.

“The rise of gold-backed currencies that circumvent the US banking system, coupled with sanctioned regimes’ growing interest in the adoption of alternative currencies and payment systems, could create a massive blind spot for US financial intelligence and sanctions enforcement efforts,” argues the Atlantic Council in an acute analysis. It suggests that Western countries should stop spraying sanctions around like they’re antibiotics on a pig farm, or such a future will come to pass sooner than anyone would think possible.

It's a warning that seems to be falling on deaf ears in Washington, where congresspeople are busy debating ever-higher sanctions, and where businesspeople are busy riding the crypto wave. The latest deal is the appearance of Tron on Nasdaq via a reverse merger, which is good news for the company’s Chinese-born founder Justin Sun. As you may remember, a probe by US regulators into Sun’s activities was paused after he made a $75 million investment into the Trump family’s crypto firm World Liberty Financial last year.

This was not the only Trump dividend from the family partnership with Tron, a blockchain blamed for 58 percent of all illicit activity in the crypto world, since two of the president’s sons in February joined the advisory board of the bank that organised the reverse merger. On top of that, Tron has started minting the Trump family’s own stablecoin USD1, which will help increase the first family’s already large crypto dividend.

In case you’re concerned that the business ties between Sun and the Trump family might lead to a conflict between the president’s personal and public interests, however, there is no need to be. “President Trump is dedicated to making America the crypto capital of the world,” White House spokesperson Anna Kelly has said. “His assets are in a trust managed by his children, and there are no conflicts of interest.”  I don’t remember everyone being quite so accepting that Hunter Biden’s business interests were separate to those of his father, but of course that was a very long time ago.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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Coda’s ZEG storytelling festival in Tbilisi has come to an end, and I am both overloaded with information and exhausted by drinking too much wine. My take-home message was that oligarchy is spreading ever wider, and that we need to take its threat to democracy far more seriously than anyone is doing at the moment.

I shared a stage with Ed Caesar, author and journalist from The New Yorker- magazine, who has written some great pieces on oligarchs (as well as much else), with Paul Caruana Galizia, who made this excellent podcast on Londongrad, and with Hans Gutbrod, whose piece on Georgia’s own Bidzina Ivanishvili is very much worth reading. And if you like surreal, ethereal documentaries, I highly recommend Salome Jashi’s ‘Taming the Garden’, which tackles oligarchy and its implications through the story of Georgian trees. 

The joy of the festival is in the incidental meetings, of which few were more joyful for me than sitting next to Joseph Stiglitz at dinner and getting to hear his views on inequality, oligarchy, and the age of Trump. Where else would I ever get to do that? 

Moral of the story: you too should find time to come to Tbilisi next year for ZEG. If you do, you can also make a side-trip to the market to stock up on one of the world’s best condiments.

SHOW US THE MONEY

Victoria Cleland, the Bank of England’s Chief Cashier, has announced that worried Brits are hoarding cash. “At a time of uncertainty, at a time of crisis people do move to cash. They want to make sure they have literally got something under the mattress,” she said at a conference in London.

This, she said, helps to explain why the value of all the banknotes in circulation keeps going up – indeed, it hit a new all-time high of 85.872 billion pounds this year – despite the fact that people use less cash all the time. The Bank of England has previously estimated that between 20 and 24 percent of banknotes at any one time are being used in transactions, and the rest are unaccounted for (or, according to Cleland, hoarded). 

So, if we do the sums and we accept Cleland’s logic, we can say that around 1,000 pounds worth of banknotes is being hoarded by every single person in the UK, up from around 920 pounds last year. I have to say that, with all due respect to Cleland, I am very dubious about that figure, not least because someone is getting a double share to make up for the fact that I don’t have even a fraction of that.

The most recent survey I can find, which is from 2022, suggests I am not alone. The average Brit had just 113.82 pounds at home back then, and it’s hard to see why that total would have increased ninefold in the last three years.

This is not a UK-specific situation. The last survey conducted for the Federal Reserve shows that the average American had $373 either in their wallet or at home in 2024, down $70 from the year before. So cash hoarding in the US is going down, but the value of banknotes in circulation keeps going up –  indeed, it hit a new all-time high of $2.835 trillion in the most recent data release, which is around $7,000 for every person in the United States. So either Brits and Americans alike are spectacularly under-reporting how much cash they’re keeping at home, or someone else is using all that cash for something else.

Considering that barely a week goes by without news of major money laundering gangs being busted with bags full of banknotes, I personally would like it if central bank officials put a little bit of thought into asking whether the extremely healthy demand for their products is not in fact coming from organised criminals. And if it is, whether central banks ought to do something about that.

Five years ago, the House of Commons’ Public Accounts Committee scolded the Bank of England for not caring about where its banknotes go. “The Bank needs to get a better handle on the national currency it controls,” its chair, MP Meg Hillier, said. It still does.

TRACKING ‘ENDANGERED’ MILLIONAIRES

Regular readers will know how much I admire the ability of Henley & Partners, the world’s foremost passport vendor, to turn almost any piece of news into an advertisement for buying a new passport and/or visa.

In recent times, the alarm is being sounded by changes to British tax policy which, basically, make it more expensive for very rich people to live and to die in the UK. And Henley responded in the way that it always does – “provisional estimates for 2024 are even more concerning, with a massive net outflow of 9,500 millionaires projected for this year alone,” it reported last year about the “wealth exodus”. All was not lost, however. If only the UK would scrap taxes on capital gains and inheritance and privatise its healthcare system, millionaires might be persuaded to stay.

The ‘research’ was picked up very widely, with few media outlets questioning its methodology, its publisher’s motivations, how representative its purported database of 150,000 people was of the millions of millionaires in the world, or indeed how exactly anyone knows where they’re all going. The Tax Justice Network has now delved into the report, and its findings are worth a read, not least the headline conclusion that there was no exodus. The correct policy response, it argues, would therefore not be tax cuts at all but higher taxes on wealth.

So, what should we think? Are millionaires leaving the sinking ship, or are they clinging on to help rebuild? Should we lower taxes or raise them? The obvious solution is surely to use satellite tags so millionaires can be tracked like wildebeest as they migrate from the watering holes of Chamonix to the rich, grazing pastures of Mayfair via the rutting grounds of St Barts. Only then can we know for sure if they’re being chased into extinction.

CALLING OUT MONACO

The European Union’s regularly updated “list of high-risk jurisdictions presenting strategic deficiencies in their national anti-money laundering and countering the financing of terrorism (AML/CFT) regimes” has done something worthwhile for the first time I can remember by singling out Monaco.

Normally, the list is made up of a random selection of irrelevant places and third-order tax havens. And there’s plenty of the usual on display: why anyone would worry that Côte d'Ivoire, Namibia and Nepal, for example, are supposedly big centres for financial crime, I have no idea. And normally, the list will avoid pointing a finger at any country that is closely allied or aligned with any EU member, which means the U.S. and U.K. never get singled out even though they’re clearly far more problematic than, say, Algeria.

This time, however, the list does single out Monaco. The principality is a major problem, with deep ties to deeply unsavoury people and a fast-developing financial scandal.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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There are two options for criminals in a democracy who don’t want to go to jail. The first is to launch a large-scale campaign to legalise whatever crime it is that you want to commit. This is hard, slow, laborious and, in most cases, impossible. The second is to not get caught. This is not necessarily easy either, but it’s a lot easier when law enforcement agencies are small, embattled and under-funded.

The 300,000 or so financial institutions subject to regulations in the United States have to report any suspicions they have about transactions, as well as reports of large cash payments, to the Financial Crimes Enforcement Network, or FinCEN. The idea is that their reports will alert investigators to crimes while they’re going on, and help the goodies catch the baddies.

DEFUNDING THE COPS

Sadly, however, FinCEN’s computer system is so clunky it’s like, as a former prosecutor once said, trying to plug AI into a Betamax. Investigators often have to create their own programmes to trawl a database that gains more than 25 million entries every year, or else just pick through them in the hope of finding something interesting. It effectively means that this vast and priceless resource is hardly ever used.

And now FinCEN’s budget looks like it will be slashed even further. “The pittance allocated to FinCEN in the current budget has been reduced even further,” wrote compliance expert Jim Richards, with a link to the 1,200-page supplement to the White House’s proposed 2026 budget with details about the cut. The reduction would take spending back to 2023 levels, which is worrying for anyone keen on seeing criminals stopped. And that’s even before you take into account the effect of workforce disillusionment at regulators such as the Securities and Exchange Commission, resulting from the cuts imposed by DOGE.

“I experienced some dark times during my SEC career, including the 2008-09 financial crisis and the Enron and Madoff scandals,” wrote Martin Kimel in a passionate column in Barron’s. “ But morale at the Commission is the worst I have ever seen, by far. No job is secure. Nobody knows what will become of the agency or its independence.” So, he added, “when the SEC offered early retirement and an incentive payment for people to voluntarily resign, I and hundreds of others reluctantly accepted.”

If you lose experienced personnel, and you lack the resources to invest in the latest technology, you will always lose ground against entrepreneurial and skilled financial criminals. That is the inevitable consequence of what is happening in the United States, which will be devastating for the victims of fraudsters, crooks, hackers and more.

THE UK PRECEDENT

There is, however, a cycle to this kind of thing. Governments that are determined to unleash the private sector always cut enforcement of regulations, but then they become embarrassed by the inevitable revelations of corruption, sleaze and incompetence that result. This is what happened in Britain, where years of news headlines about London being the favourite playground of oligarchs finally led to government action.

Three years ago, the British authorities imposed a special levy on financial institutions to fund the bodies that fight crime, and last month it published a report on the first year of spending. More than 40 million pounds has been invested in new technology to tackle Suspicious Activity Reports (so no more Betamax in London), and almost 400 people have been hired to do the work, including some of them finally beginning to try to drain the swamp that is the U.K.’s corporate registry. This is good news. 

It is inevitable that, just like in the U.K., the United States will eventually become so appalled by the rampant criminality that will result from the cuts to FinCEN, the SEC and other bodies, that politicians will start building a decent system to stop it. I just wish everyone would get on with it, so millions of people don’t have to lose out first.

THE EU GETS INTO GEAR?

You can accuse the European Union of many things, but you can’t say that it acts hastily. Several months after the last progress update from the Anti-Money-Laundering Agency (AMLA), it has appointed its four permanent board members. They represent an interesting cross-section of European expertise. 

There’s Simonas Krėpšta who, at the Bank of Lithuania, has overseen the country’s booming fintech sector and, therefore, has a good insight into the country’s booming money laundering sector, which has seen quite a lot of firms get fined, including arguably Europe’s most valuable startup Revolut. 

Then there’s Derville Rowland of the Central Bank of Ireland, who will bring inside knowledge of Europe’s most aggressive tax haven. And Rikke-Louise Ørum Petersen, who joined Denmark’s Financial Supervisory Authority in 2015, just when the money laundering spree by Danske Bank was about to explode into public view. Finally, there’s Juan Manuel Vega Serrano, who was previously head of the Financial Action Task Force, which gives him plenty of experience of working at an ineffective, slow-moving, superficially apolitical, supranational anti-money laundering organisation. 

All told, I’d say this is a pretty perfect group of people for the job. The European Union works slowly, but it works thoroughly. Of course, AMLA won’t actually be doing anything until 2028, and it probably won’t do much after that either. But you can’t have everything.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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The Corporate Transparency Act was passed by Congress at the very end of Donald Trump’s first term, with bipartisan support and an important mission to protect national security, expose wrongdoing and complicate the committing of financial crime by forcing companies to declare the names of their owners. 

This was at the time not a controversial piece of legislation, not least because American politicians – as part of the Financial Action Task Force – have been pressuring other countries to pass similar laws since the late twentieth century. But it has proved messy to implement. FinCEN, the United States’ financial crimes enforcement network, only finished making the necessary rules to file what it calls “beneficial ownership information” last year – just in time for judges in Alabama and Texas to declare them illegal, and then for the second Trump administration to basically ditch them altogether by saying they don’t apply to 99.9 percent of corporations that are registered in the U.S.

The consultation period over this decision to ditch the filing requirement is now over. (So, if you feel strongly but didn’t get round to writing in, I’m sorry to say you’ve missed your chance.) It is now possible to browse through the several-dozen submissions from concerned citizens and organisations, which is an enlightening experience.

MAKING COMPANIES OPAQUE AGAIN

In the pro-rules camp, you can find comments from law enforcement agencies, anti-corruption organisations, environmental campaigners, credit unions and others who are concerned that the Trump administration’s decision to maintain the previous lax standards is damaging and unwise.

“Without this data,” stated the National District Attorneys’ Association, in a fairly typical submission, “prosecutors are left blind when investigating shell companies used by fentanyl and human traffickers, cybercriminals, and corrupt foreign actors.” These, they added, “are not abstract concerns –these are real threats to American families and communities.”

In the other camp are the small business owners, or associations representing them, who are delighted that the requirements to file their details with FinCEN are now history, and want all beneficial ownership information already filed to be deleted. 

“For many of us, the original BOI requirements felt like an unfair assumption of guilt, treating hard working entrepreneurs as potential criminals rather than the backbone of our economy,” wrote Stephen McKissen, the owner of a video production company in Denver, Colorado. Removing the requirement, he argued, “for US companies and US persons to report BOI lifts a significant weight off our shoulders.” 

Ever since the world’s first piece of anti-money laundering legislation was passed in 1970, businesses have complained about the compliance burdens it imposed upon them. Criminals hide by pretending to be legitimate businesspeople, and the only way they can be exposed is by imposing rules on everyone, thus obliging honest folk to undergo paperwork and inconvenience, which is not popular with the honest folk (or, I suppose, the dishonest ones).

It's crucial to the way the legislation is implemented therefore to minimise that inconvenience, to make sure it does not cause so much irritation that it becomes a political issue. This appears to be where the U.S. efforts ran aground. I had a look at the FinCEN portal through which company ownership is registered and which the small businesses were complaining about. It didn’t look too bad to me, but if the registration process is anything like the comment-reading process, I can see why people are annoyed about having to do it.

Every single comment on the proposed rule changes has the same headline, so it’s impossible to tell which are interesting and which are utterly banal, without opening a new page, then opening a new attachment. When you return to the main page, the list of them rearranges itself unexpectedly, so it’s hard to know which ones you’ve already read. It is in short a very poorly designed piece of software, and you’d think a country that created Google, Apple, Facebook and the rest might have been able to find some better programmers.

Back, though, to America’s notoriously lax shell company legislation. It is the result of it being devolved to state level, so that some states – Delaware and Nevada are stand-out examples – end up competing with each other to attract more incorporation, thus sparking a race to the bottom. 

Perhaps there’s nothing that could have been done to make American business owners appreciate the need to file information about beneficial ownership, but the lesson for bureaucrats is that you have to make compliance easy. Having to file information at both state and federal level was never going to be popular, particularly if the web portal involved was also clunky and annoying. 

However, what’s left of the Corporate Transparency Act will nicely align with the White House’s wider agenda, since it now only applies to foreign companies that have registered to do business in the United States. If criminals currently using offshore-incorporated corporations want to avoid having to report their identity to the authorities, they’ll now need to set up a domestic shell company, which will I suppose be a small win for USA Inc.  

It’s too early to say whether Trump’s tariffs and threats will bring businesses and manufacturing back to America, but he is at least making onshore shell companies great again.

A version of this story was published in this week’s Oligarchy newsletter. Sign up here.

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I’ve been thinking a lot about the apocalypse in the last few days, and wondering what options oligarchs believe are available to help them escape it. In Mark Lynas’s new book about atomic weapons, he helpfully provides a table showing what percentage of each country’s population would die during or immediately after a nuclear war. The sheer number of places that have 100 or a number in the high 90s in the right-hand column is a bit bleak, but if you think like an enabler you can see opportunity.

New Zealand is often touted as the go-to destination for riding out the apocalypse. Vivos has apparently built a 300-place luxury bunker on the South Island, and Rising S Bunkers, an American company that specializes in the building of doomsday shelters, have been busy too. Peter Thiel obtained New Zealand citizenship, though tragically was not able to build his own mega-bunker after he failed to get planning permission. But that has not stopped other billionaires from planning their escapes to the land of the long white cloud.

BILLIONAIRE BOLTHOLES

Politicians in Wellington are only too happy to help. In April, they eased up on the rules around the country’s golden visa programme to attract more of this sweet flight capital, removing a requirement that applicants speak English, and reducing the cost. You now only need to spend 21 days in the country to establish residency, down from three years, which is good news for tech barons keen not to have to pay tax or make friends or stuff like that.

“In the past, the vast majority of applicants were looking for tax havens,” former immigrant minister Stuart Nash told the FT. “Now they’re looking for safe havens.” Nash is a man for the snappy catch phrase. Since leaving government, he has set up Nash Kelly Global, a relocation company, which has the distinctly yuk for an ex-politician but very on-brand tagline: ‘What they don’t tell you about New Zealand. It’s not what you know. It’s who you know.’

But I’m afraid New Zealand is not quite the safe option it’s been cracked up to be. For a start, how safe is New Zealand? Lynas’ deaths table shows that in the event of war, 68 percent of New Zealanders would be dead after two years of nuclear winter. Okay, that’s better than Russia (98 percent), the United States, China, the United Kingdom, Canada, France, Germany (99 percent) or Switzerland and the United Arab Emirates (100 percent), but it’s still not great. And expensive fortifications wouldn’t help: billionaires would not be able to hide forever from gangs of survivors and would be, Lynas writes, “winkled out of their bunkers and hiding places like fat grubs”. 

So, which countries do offer the best survival prospects in the event of Trump or Putin getting an itchy trigger finger? Iceland, Argentina, Paraguay, Uruguay, Costa Rica, Haiti and – painfully no doubt for Kiwis – Australia all have a 0 percent death rate. At present, Iceland does not sell visas, and Australia closed its investor visa programme last year, so it’s no good to you even if you have the cash to flash. But there are plenty of options among the others: Uruguay’s is a bit pricey, but Costa Rica will sell you residency for just $150,000, and Argentina is practically giving it away.

I’m surprised no one’s started marketing these countries to rich people worried about nuclear war: ‘If life sends you nuclear winter, enjoy the fresh powder.’ Mr Nash, you can have that one for free.

ESCAPE TO MARS

Of course, everywhere on Earth is going to be impacted a bit by nuclear war, so why not abandon our planet altogether? Elon Musk’s current plan is for a first unmanned mission to take off for Mars next year, with people due to land on the red planet in 2028, and for a self-sustaining colony to exist within 20 years.

SpaceX has released a handy new video simulation of the journey, though I hope for the Muskonauts’ sake that they won’t have to listen to that dreadful music for the entire eight-month trip. If I was as rich as Musk, I’d have licensed Queen’s ‘Don’t Stop Me Now’ at least. The upside to living on Mars of course is that you wouldn’t be on a planet that could be rendered uninhabitable by a nuclear bomb. The downside though would be that you’d be on a planet that’s already uninhabitable. So, perhaps it would be better to focus on securing the future of Earth instead? 

“Surely the best way to protect the human species in coming decades is to focus on resolving the tensions we face at home, from unbridled nuclear proliferation to strategic global competition and realignment,” wrote noted physicist Lawrence Krauss.

Predictably enough, Musk dismissed Strauss’ argument by tagging @IfindRetards in reply (such a hilarious guy!). But Strauss raises an interesting point. Cold War-era treaties, negotiated to prevent an extraterrestrial arms race, declare that there is no sovereign territory or territorial appropriation in space. Yet, according to Starlink’s terms of service, Mars is “a free planet”, and no Earth-based powers have authority there: “Disputes will be settled through self-governing principles, established in good faith, at the time of Martian settlement.” 

That looks a lot like Musk is claiming the right to govern Mars as its settlers see fit. Of course, it’s not impossible that the new settlers (who will have been chosen by Musk, trained by Musk, brought to Mars by Musk’s rocket, and who will be entirely dependent on Musk for future resupply) might set up a genuinely democratic system of self-government. But it’s also possible that Musk might want to claim Mars for himself. That would be in violation of Earth’s treaties, and therefore bad. It would also – considering the havoc wreaked by Musk in his brief stint in government – be a pretty grim prospect on its own terms. 

Of course, you don’t need to go to Mars to set up your own government. Right here on earth we have Eleutheria, which is now aiming to negotiate a 99-year lease for a bit of Tuvalu to build a “free private city”, having given up on the idea of building a state in a Bir Tawil, an isolated, unclaimed bit of desert between Egypt and Sudan. It is indeed easier to imagine the end of the world than the end of capitalism.

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Since Donald Trump returned to the White House in January, some 31 percent of “revenue agents” (the people tasked with conducting tax audits) have lost their jobs. This is supposed to save the government money, but it’s a bit like trying to reduce the cost of crime by sacking police officers. 

“This administration is clearly running the risk of losing hundreds of billions of dollars -- in fact, likely over $1 trillion -- through its destruction of the IRS. “At a time when deficits are high and rising, that seems a baffling policy choice,” said Larry Summers, noted economist, former treasury secretary, and former president of Harvard University.

The policy is indeed baffling if its aim is to collect taxes; it’s not baffling at all, though, if the intention is to help rich people dodge them.

An early announcement from Trump’s Department of Justice was to pause enforcement of the Foreign Corrupt Practices Act, which has been central to global efforts against bribery since the 1970s. Trump has long argued that prosecuting American businesses for bribing foreign officials makes it harder for U.S. companies to compete. A new DoJ memo shows that it has now thought about what it wants to do, and how to do it in a way that prioritises American interests.

There have long been suspicions that U.S. authorities reserve their biggest fines for non-US companies (a French bank getting fined almost $9 billion, for example), and suggesting that prosecutions will be “America first” is unlikely to help with that perception. “Enforcement of the Foreign Corrupt Practices Act ("FCPA") will now be focused on conduct that harms U.S. interests and affects the competitiveness of U.S. businesses, further suggesting that future FCPA enforcement will be focused on non-U.S. companies,” noted lawyers from White&Case in this assessment.

There is already widespread global concern that the Trump administration will exploit the U.S. dollar’s dominant position in finance to force foreigners to do what it wants. Suggestions that corruption laws are not equally enforced will only further that suspicion. The fewer foreigners who rely on dollars, the less impact US sanctions will have, so it would be good if officials would consider that before implementing their policies.

MINDING THE TAX GAP

Readers old enough to remember the financial crisis of 2007-8 will also remember the wave of popular anger against tax-dodgers that followed it. American prosecutors investigated Swiss banks (good times!); protesters occupied branches of Starbucks (fun!); almost all countries agreed to exchange information with each other about their citizens’ tax affairs to uncover cheats (massive!).

According to the EU Tax Observatory, this information exchange has been a triumph, and cut wealthy people’s misuse of offshore trickery by two-thirds. I have always been a little suspicious of these declarations of victory, however, despite them coming from such a good source, and find grounds for my doubts in this new report from the UK’s National Audit Office.

British tax authorities every year estimate a tax gap – the difference between what the country’s exchequer should receive, and what it actually gets – and politicians regularly talk about reducing it. If the Trump administration seems uninterested in clamping down on tax evasion, and financial chicanery in general, the British government has pledged additional resources for technology and investigators to try to understand what’s happening and whether its tax gap estimate is close to being accurate, so we may learn more about this in future years. Fingers crossed.  

But the NAO report suggests that the way it’s calculated may be a bit questionable. According to the standard estimate, wealthy individuals pay around 1.9 billion pounds less than they should. But, according to a different estimate (“compliance yield”), the tax authorities have successfully brought in an extra 3 billion pounds from wealthy people that would not have been collected without their efforts.

It is a little hard to understand how it is possible to increase tax compliance by 1.1 billion more pounds than the entire deficit that wealthy people are supposedly underpaying. It’s like losing two pounds down the back of an armchair, reaching beneath the cushion and finding three. Except with billions. Something else is very definitely going on. “The large increase in compliance yield raises the possibility that underlying levels of non-compliance among the wealthy population were much greater than previously thought,” notes the NAO.

I am, I admit, someone who fixates on offshore skulduggery, but I can’t help noticing the report states that a mere five percent of the UK tax authorities’ investigative efforts were looking into “offshore non-compliance”. Tax advisers are clever, well-paid people, and they’ll know very well about the best places to hide their clients’ money, and there’s even a suggestion for them in the report: if your client holds wealth in properties abroad, or owns shares in her own name rather than through an institution, her home government will never know about her income she earns from them. Happy days.

A POSTER CITY FOR ILLICIT FINANCE

And speaking of offshore skullduggery. The city of Mariupol has long been central to the war in Ukraine. Enveloped early by Russian forces, its defenders held out for months in an epic battle in the ruins of the Azovstal steel plant, before surrendering in May 2022. Moscow has since made it the poster city for the supposedly prosperous future available in a Russia-ruled Ukraine, but a new report makes clear how hollow such claims are.

“Powerful Moscow-based networks are controlling much of the reconstruction programme. Well-connected companies are benefiting from Russian spending that involves the widespread use of illicit finance and corrupt practices,” note its authors, David Lewis and Olivia Allison. They have specific policy recommendations, of which I think the most important ones relate to my old bugbear of sanctions, which should be better targeted and more strategically deployed. Russia’s crimes in Ukraine include the looting and economic exploitation of cities like Mariupol. 

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As Rome prepared to select a new pope, few beyond Vatican insiders were focused on what the transition would mean for the Catholic Church's stance on artificial intelligence. 

Yet Pope Francis has established the Church as an erudite, insightful voice on AI ethics. "Does it serve to satisfy the needs of humanity to improve the well-being and integral development of people?”” he asked G7 leaders last year, “Or does it, rather, serve to enrich and increase the already high power of the few technological giants despite the dangers to humanity?"

Francis – and the Vatican at large – had called for meaningful regulation in a world where few institutions dared challenge the tech giants.

During the last months of Francis’s papacy, Silicon Valley, aided by a pliant U.S. government, has ramped up its drive to rapidly consolidate power.

OpenAI is expanding globally, tech CEOs are becoming a key component of presidential diplomatic missions, and federal U.S. lawmakers are attempting to effectively deregulate AI for the next decade. 

For those tracking the collision between technological and religious power, one question looms large: Will the Vatican continue to be one of the few global institutions willing to question Silicon Valley's vision of our collective future?

Memories of watching the chimney on television during Pope Benedict’s election had captured my imagination as a child brought up in a secular, Jewish-inflected household. I longed to see that white smoke in person.  The rumors in Rome last Thursday morning were that the matter wouldn’t be settled that day. So I was furious when I was stirred from my desk in the afternoon by the sound of pealing bells all over Rome. “Habemus papam!” I heard an old nonna call down to her husband in the courtyard. 

As I heard the bells of Rome hailing a new pope toll last Thursday I sprinted out onto the street and joined people streaming from all over the city in the direction of St. Peter’s. In recent years, the time between white smoke and the new pope’s arrival on the balcony was as little as forty-five minutes. People poured over bridges and up the Via della Conciliazione towards the famous square. Among the rabble I spotted a couple of friars darting through the crowd, making speedier progress than anyone, their white cassocks flapping in the wind. Together, the friars and I made it through the security checkpoints and out into the square just as a great roar went up. 

The initial reaction to the announcement that Robert Francis Prevost would be the next pope, with the name Leo XIV, was subdued. Most people around me hadn’t heard of him — he wasn’t one of the favored cardinals, he wasn’t Italian, and we couldn’t even Google him, because there were so many people gathered that no one’s phones were working. A young boy managed to get on the phone to his mamma, and she related the information about Prevost to us via her son. Americano, she said. From Chicago.

A nun from an order in Tennessee piped up that she had met Prevost once. She told us that he was mild-mannered and kind, that he had lived in Peru, and that he was very internationally-minded. “The point is, it’s a powerful American voice in the world, who isn’t Trump,” one American couple exclaimed to our little corner of the crowd. 

It only took a few hours before Trump supporters, led by former altar boy Steve Bannon, realized this American pope wouldn’t be a MAGA pope. Leo XIV had posted on X in February, criticizing JD Vance, the Trump administration’s most prominent Catholic.

"I mean it's kind of jaw-dropping," Bannon told the BBC. "It is shocking to me that a guy could be selected to be the Pope that had had the Twitter feed and the statements he's had against American senior politicians."

Laura Loomer, a prominent far-right pro-Trump activist aired her own misgivings on X: “He is anti-Trump, anti-MAGA, pro-open borders, and a total Marxist like Pope Francis.” 

As I walked home with everybody else that night – with the friars, the nuns, the pilgrims, the Romans, the tourists caught up in the action – I found myself thinking about our "Captured" podcast series, which I've spent the past year working on. In our investigation of AI's growing influence, we documented how tech leaders have created something akin to a new religion, with its own prophets, disciples, and promised salvation.

Walking through Rome's ancient streets, the dichotomy struck me: here was the oldest continuous institution on earth selecting its leader, while Silicon Valley was rapidly establishing what amounts to a competing belief system. 

Would this new pope, taking the name of Leo — deliberately evoking Leo XIII who steered the church through the disruptions of the Industrial Revolution — stand against this present-day technological transformation that threatens to reshape what it means to be human?

I didn't have to wait long to find out. In his address to the College of Cardinals on Saturday, Pope Leo XIV said: "In our own day, the Church offers to everyone the treasury of her social teaching, in response to another industrial revolution and to developments in the field of artificial intelligence that pose new challenges for the defence of human dignity, justice and labor."

 Hours before the new pope was elected, I spoke with Molly Kinder, a fellow at the Brookings institution who’s an expert in AI and labor policy. Her research on the Vatican, labour, and AI was published with Brookings following Pope Francis’s death.

She described how the Catholic Church has a deep-held belief in the dignity of work — and how AI evangelists’ promise to create a post-work society with artificial intelligence is at odds with that.

“Pope John Paul II wrote something that I found really fascinating. He said, ‘work makes us more human.’ And Silicon Valley is basically racing to create a technology that will replace humans at work,” Kinder, who was raised Catholic, told me. “What they're endeavoring to do is disrupt some of the very core tenets of how we've interpreted God's mission for what makes us human.”

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Apparently, the word “deadline” was first coined in a notoriously brutal Confederacy-run prison during the American Civil War: any prisoners that crossed the line got killed. The point of a deadline is that, if you don’t stick to it, there are severe consequences. So what do you call a line that, should you cross it, brings zero consequences? A shrug-line? A meh-line? A British-Overseas-Territories-line?

“Anguilla, Bermuda, the British Virgin Islands (BVI), the Cayman Islands and the Turks and Caicos Islands will have legislation on registers of beneficial ownership approved through their respective legislatures by April 2025, with implementation by June 2025 or earlier,” was the unequivocal deadline in a joint communiqué agreed by the British government and the leaders of these five of its Overseas Territories (OTs) in November last year.

It's now May and, well, that has not come to pass. The deadline has been crossed. So what will happen now that all of them (except the Cayman Islands) have failed to approve laws to open up their corporate registries? Will someone get shot? Or will everyone just shuffle about a bit and hope no one’s noticed?

These five jurisdictions are leftover bits of the British Empire which, for various reasons, never became independent. London wasn’t particularly keen on keeping them, mainly because doing so was expensive, so back in the 1960s, ‘70s and ‘80s, they were encouraged to find ways to fund themselves, with no one particularly caring how they went about it. 

Each of these territories, to varying extents, discovered that there was profit to be made from helping foreigners to move money, and not asking too many questions about where the money came from. As a result, these places are often referred to as tax havens, but that’s misleading since they offer far more than just tax advantages to their clients. 

Shell companies, particularly those of the BVI, became notorious for hiding money for gangsters, tax dodgers, cartels, kleptocrats and other crooks, and the British government struggled to do anything about it. Then, in 2018, a group of backbench MPs seized on the post-Brexit collapse in political coherence and passed a law forcing the OTs to open up their corporate registries so everyone could see who actually owned their companies.

The law came with a deadline: the end of 2020. But no one obeyed it, so it was extended by the British government to 2023. No one obeyed that deadline either, so it was extended again to April 2025. And now? It’s all just a bit embarrassing.

“We must stop the dither and delay of recent years and pierce the veil of anonymity that protects criminals and kleptocrats,” said Margaret Hodge and Andrew Mitchell, architects of the 2018 legislation, back in November last year. But dither and delay persist.

The debate gets caught up in allegations of ignorance, colonialism, arrogance and so on, but it really comes down to one important point: no one in power in Britain cares enough about stopping corruption to take the political and financial hit of overruling the OTs’ own politicians and paying their bills. More than half of the BVI’s budget comes directly from company incorporation fees. What money do you replace that with, if you change the rules so that no one wants to set up shell companies there anymore?

In the case of Anguilla, a surprising amount of money – around $50 million this year, apparently, which is about a third of all its revenues – comes from its domain name, which is the fortuitous .ai. But that’s not an option open to the other OTs, and if they ask too many questions about who’s doing business with them, that business will go elsewhere.

TETHERED TO EL SALVADOR

One business that already has gone elsewhere is Tether, the crypto company that runs the world’s most popular stablecoin USDT, which has almost $150 billion worth in circulation, and incidentally has a domain name -- .io – derived from yet another random imperial fragment, the British Indian Ocean Territory. Previously registered in the BVI, Tether relocated to El Salvador earlier this year after it obtained a license from President Nayib Bukele’s government.

Bukele, whose in his X bio currently describes himself as a “philosopher king”, is much caressed by the American right, who love him for his willingness to indefinitely lock up not just Salvadorans but anyone the U.S. wants to imprison without bothering first to check if they’re guilty or not. Bukele’s methods, the American right says, has made El Salvador safer. But, thanks to journalists from El Faro, we have yet more evidence that the decline in crime that he boasts of may be at least as much to do with secret negotiations with gangsters as it is to do with arresting them. 

“Gangs turned Bukele into a relevant politician,” said El Faro’s editor-in-chief Óscar Martínez. “It is impossible to understand Bukele’s rise to total power without his association with gangs.”

So how does a man who’s previously called himself the “world’s coolest dictator” respond to press reports like these? By threatening to lock up the journalists involved of course, allegedly with investigations under criminal statutes often used against gangsters.

“Treating journalism as a criminal act deprives Salvadorans of essential information,” said Cristina Zahar, Latin America programme coordinator at the Committee to Protect Journalists. “Prosecutors should abandon these cases now and ensure ‘El Faro’ journalists can safely report on matters of public interest.”

Tether has no problems with El Salvador’s political atmosphere and complexities. It plans to build a 70-storey tower in the capital, San Salvador, which will serve both as its headquarters and as a location for other finance companies. “It is the country of the future,” says Tether CEO Paolo Ardoino. 

The fact that the stablecoin issuer is bedding so comfortably into a place like El Salvador is bad news for people who worry about Tether’s outsized role in enabling global money laundering, but potentially good news for Bukele, who has made crypto a key part of his development plan for his chronically-indebted nation. It’s too early to say whether this has worked – although it’s also too early, no matter what “The Economist” might think, to say that it hasn’t --  but it’s an interesting echo of the British OTs’ twentieth-century model: undercut everyone else’s regulations, enable crime overseas, and make a good living out of it.

It's too much to hope that, as a civilisation, we’d have learned from our mistake sufficiently not to repeat it, but I do hope we’re not still going to be arguing about how to solve the resulting problems in 50 years time.

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It happened so quickly.

On Friday afternoon in Delhi, I was at my daughter's school, waiting to pick her up and straining to eavesdrop on knots of parents and -- this being Delhi -- separate knots of household staff. Every tightly bunched group was absorbed by conversation on the only subject anyone in Delhi, and no doubt the rest of India, was talking about: are we going to war with Pakistan?

By Saturday afternoon, my assumption that India and Pakistan would find a way to step back from the brink because they had no other serious choice, seemed wildly optimistic. On the jingoistic, cacophonous, largely unwatchable Indian news channels, there were still reports of drones being shot down and air bases and military infrastructure being attacked. War seemed imminent. So imminent that India’s largest-selling weekly newsmagazine went with “War!” and a battalion of fighter jets on its cover. 

But by five pm on Saturday, Donald Trump announced a complete ceasefire. Before anyone from the Indian or Pakistani government had said anything. Entire nations were caught off guard. The screeching newsreaders, still foaming at the mouth, were outraged – “who moved my war?” 

And then the media swiveled on a dime (rather, a one-rupee coin). Spinning furiously, crazed hamsters on their wheels, the analysts and anchors insisted India had won. In Pakistan, their counterparts were doing much the same. The truth is, both countries had lost 

India and Pakistan had been locked in a clumsy, deadly two-step while the rest of the world looked away. It began on April 22, with a terrorist attack in Pahalgam, Kashmir, in which 26 men, almost all of them Hindu, and singled out for their religious affiliation, were killed. United States Vice President JD Vance, was in India on a “private trip” at the time, with his Indian-American wife and children.

The attack was a provocation that the Indian Prime Minister Narendra Modi's Hindu nationalist government could not tolerate. Their supporters bayed for vengeance. And Modi, whose personal brand as the protector of the Hindu nation – boasting in campaign speeches about his 56-inch chest – is predicated on him being the leader of a newly vigorous, aggressive India, an emerging superpower, had to respond with overwhelming force.

It took two weeks -- during which India did not provide proof of the Pakistani state's involvement in the April 22 attack beyond an established history of Pakistan’s financing of terror. The country featured on the Financial Action Task Force's grey list between 2018 and 2022, though it insists it has since largely cleaned up its act. Indian retribution came in the form of the bombing of what India described as terrorist camps. This was, Indian officials said, a restrained, responsible response to Pakistan-sponsored terrorism. No military sites, for example, were hit.

Pakistan said civilians were killed and that mosques were bombed. They then retaliated to India's retaliation. And India retaliated to Pakistan’s retaliation against India’s retaliation. Inevitably, there was a retaliation to the retaliation to the retaliation against the retaliation. And so on, until Trump announced the ceasefire. As the bombings intensified, both India and Pakistan insisted they didn't want war and were taking responsible actions to de-escalate. In the warped logic of this fighting, the bombs being dropped actually signaled both countries' understanding that they could go so far and no further.

Initially, the United States, which has played a part in brokering peace in previous clashes between India and Pakistan, seemed content to let both countries duke it out. It’s “none of our business,” said Vance. While Donald Trump seemed to think the dispute over Kashmir was the latest episode of a show that dated back "1,000 years, probably longer." Later, he modified this assessment to mere centuries.

The truth is, this conflict is a product of British colonial rule, of the hastily conceived and disastrously executed partition of India in 1947. The Cliffs notes, with considerable nuance lost through inadequate summary, are as follows: Kashmir, a Muslim-majority state with a Hindu king, wanted to be independent of both India and Pakistan. But when Pakistani forces invaded Kashmir in October, 1947, the king asked India for help and signed an agreement binding Kashmir to the Indian union. 

It led to the first war between Pakistan and India, nations that were born just weeks earlier as the British departed. Under the terms of a United Nations-negotiated ceasefire, India gained control of about two-thirds of Kashmir. But this was temporary until a plebiscite to determine the future of Kashmir was held. This plebiscite never happened. As a result, both countries believe they have an inalienable right to the entirety of Kashmir: India because of the king's decision to sign the instrument of accession; Pakistan because Kashmir is a Muslim-majority state and Pakistan was created as a homeland for the subcontinent's Muslims. In 1965, both countries fought another inconclusive war. 

But as long as India continues to pretend there is a viable military solution to its disputes with Pakistan, the prospect of conflict, if not outright war, remains an ever-present Damoclean threat.

But since 1989, as the Soviet Union collapsed and there was a proliferation of US-funded mujahideen in the region, separatist sentiments in Kashmir spiraled into violent insurgency. India says these militants are a proxy, a tool of the Pakistani deep state. So Kashmir became a theater of both postcolonial and post-Cold War conflict.

Between 1999 and 2019, the U.S. reliably talked both countries off the ledge and leading international diplomatic efforts to get India and Pakistan to back off when overly aggressive gestures and posturing threatened to become kinetic. The U.S. has Cold War-era strategic and security ties with Pakistan but only recently has India become a close partner with an active role to play in containing China’s emerging dominance. India, Australia, Japan and the U.S. are part of the Quad, a loose grouping intended to counter China’s designs on the Indo-Pacific.

Modi and Trump have made several displays of personal friendship, each supporting the other’s election campaigns. But the Trump administration had declined to intervene in current tensions. It was a position of apathy, as if it had no stake in preventing war. For Modi, it must sting that carefully choreographed hugs with Western leaders had not resulted in more diplomatic support for his military action against Pakistan. 

Modi also received little support from institutions. For instance,  India had lobbied for the IMF to withhold funds from Pakistan. But the IMF chose to release $1 billion in loans to Islamabad, even as Pakistan was engaged in artillery exchanges with India. With the U.S. seemingly taking a back seat, Saudi Arabia and Iran had offered to mediate, as had Russia. Even China, which provides over 80% of the Pakistani army's weaponry and also administers part of Kashmir, said it would help broker peace. 

But it was the U.S. that swooped in over the weekend. Trump and Secretary of State Marco Rubio both posted about the negotiations, with Trump even saying he had used trade as leverage to prevent a nuclear war. “Millions of people,” he said, “could have been killed.”

While Pakistan were happy to acknowledge the U.S. role in forcing a truce, Indian diplomats and politicians were either tight-lipped or disapproving. India has long resisted external interference in the Kashmir dispute, insisting that negotiations have to be strictly bilateral. Ultimately, neither India nor Pakistan can afford full-scale war. This is not asymmetrical combat. India may be much larger than Pakistan and conventionally more powerful. It may have a growing economy, while Pakistan is struggling to finance its debts. But, as one British analyst said, if this is a Goliath-David struggle, David has a nuclear weapon in his sling. 

The Trump-brokered ceasefire may only be temporary respite – so temporary, indeed, that barely hours after the agreement was announced, the chief minister of Indian-administered Kashmir posted on X that he had heard explosions in the state capital Srinagar. “What the hell,” he wrote, “just happened to the ceasefire?” But as long as India continues to pretend there is a viable military solution to its disputes with Pakistan, the prospect of conflict, if not outright war, remains an ever-present Damoclean threat.

As an Indian citizen and a parent, I find both governments' confidence that they can toe an invisible line more than a little disconcerting. But, judging by the political and media response to the prospect of war, only a few shared my scepticism. In India, since April 22, there have been very few calls for peace, very few questions about the need for a military response to a terrorist attack, even though bombing Pakistan has not deterred subsequent terrorism.

One of those calls for peace, though, came from Himanshi Narwal, whose husband of six days, an Indian navy officer, was shot in front of her. Narwal, who was photographed kneeling beside her husband's prone body, became a symbol of India's grief and outrage. 

That was before she spoke. Narwal told reporters that she only held the men who had murdered her husband responsible and not all Muslims or all Kashmiris. "We want peace," she said, "and only peace."

This sentiment made her a target of Hindu nationalist scorn on social media. Narwal was excoriated as a "woke secular" – a particularly Indian insult, mixing American right wing culture war tropes with the Indian use of the word "secular" to mock Indian liberals who supposedly kowtow to minorities, particularly Muslims.  

India's initial retaliation was given the code name "Operation Sindoor", a reference to the deep red powder some married Hindu women dab on the parting of their hair or on their foreheads. India's military action, in other words, was being taken on behalf of the women who had lost their husbands on April 22. Women like Himanshi Narwal. Though what she, and others like her, might think is apparently besides the point or even worthy of contempt. 

The contrast between Narwal's dignity and the absurd propaganda peddled by the mainstream Indian media would have been comical if it were not simultaneously so depressing. On Friday evening, a friend, an editor at a national magazine, sent me a collection of screen grabs of headlines in India, mostly from television news. Each claim was remarkable -- Pakistani planes being shot out of the sky, rebels from Balochistan capturing the city of Quetta, the Indian navy bombing Karachi, even reports of a coup -- and each claim was either knowingly false or entirely unverified. On Indian TV screens every night, since Wednesday night when India first bombed its targets in Pakistan, we've been exposed to a tale told by idiots.

 Was it too much to hope for some restraint? But the tone taken by the mainstream media, a mimicking of the abrasive arrogance of Hindu nationalist trolls on social media, was matched by the Indian government. I watched a spokesperson from the BJP, India's governing party, tell a British news channel about Modi's "3E policy -- evaporate, eradicate, eliminate... shameless Pakistan needs to be taught a lesson." Oy vey! 

And now, does the ceasefire mean that the so-called 3E policy has been abandoned? Would the Modi government – which had blocked the few critical, independent voices – have the courage to reimagine its response to Pakistan, to reevaluate the belligerence of its rhetoric, and to instead embrace the inherent strength in India’s secular, constitutional values and enter into constructive dialogue?

The signs are not encouraging. In a late bid to wrest the narrative momentum from Donald Trump, Indian politicians, journalists and commentators spread word of the country’s new approach to terrorism. Modi, having been silent through much of the fighting, elaborated on the “new normal,” in an address to the nation on Monday night. India, he said, would no longer distinguish “between the government sponsoring terrorism and the masterminds of terrorism.” The words were belligerent, the policies no kind of solution. 

Perhaps, India’s wounds are still too raw for self-reflection. But the question remains: Is India going to be held hostage to its own anger? Or will it acknowledge that talks, and people to people contact, must resume.

A version of this story was published in last week’s Sunday Read newsletter. Sign up here.

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When I think back to my time growing up in the 1980s and ‘90s in a small authoritarian Eastern European state bordering Greece, Turkey, Romania and the Black Sea, one scene always springs to mind: arriving at my high school in Sofia, the capital of Bulgaria, early in the morning to find a queue of sleepy students dutifully waiting to be let in. The girls were in their regulation “prestilka" – a dark blue apron with round white collar, incomparably unflattering and now reminiscent of something from “The Handmaid’s Tale”. The queue had formed because the staff were conducting a spot check on our appearance. Joining the end of the queue, I felt an undercurrent of anxiety. Would I be reprimanded today? What for?

 Living in an authoritarian state is a performative juggling act, an act of camouflage, of deflection, of concealing your true preferences, opinions and thoughts. Blending in, rendering yourself invisible increases your odds of leading a functional life.

Since Donald Trump returned to the White House, watching from London where I now live, I find myself reminded of the self-censoring and isolationist culture of 1980s Bulgaria. Every time I ask friends in the U.S. how they are doing, I receive remarkably familiar, self-distancing responses. “I’m trying to steer clear of all the information,” says one. “I guess I’m going insular and trying to focus on my family and what I can control,” says another. “I can’t cope with the news”, says a third. “I know that sticking our heads in the sand is not helpful,” a fourth one tells me, “but I feel helpless and scared and I’m not sure what I can do. Call it self-preservation.”

And there it is. The antibiotic-resistant superbug I and everyone around me grew up with. I sense it. Smell it. Feel it. Fear.

At my school in Sofia, no one was spared from scrutiny. For girls, three conformity boxes had to be ticked: aprons not too short; nails not too long or painted; hairstyles deemed neat and, if you were particularly unlucky, unceremoniously, publicly checked to be certified free of nits. If the staff decided you had failed on any of these parameters, you were reprimanded. Too many of these and you would find yourself with a reduced mark for “behaviour” at the end of term. If you graduated from school with a less than “excellent” behaviour mark, you could not apply to university, even if you’d achieved the highest possible academic grades. A short apron, fancy nails, messy hair or a smart mouth could cost you your future.

I have always been one to talk back. An ambassador’s daughter who grew up in Bulgaria, Switzerland, Afghanistan and Ethiopia before being accepted into the only English-teaching selective high school in Sofia at the age of 14, I insisted on speaking my mind at every opportunity. It was a bad, even dangerous habit. Freedom of speech in any shape or form was not a concept anyone dared entertain. The periods of terror in the late 1940s and ‘50s had made sure of that, though at the time I knew nothing about them. The terror and multiple purges were a state secret, undiscussed in books and not a topic for even private conversations. Their legacy was an atmosphere of inherited fear and mute obedience.

In hindsight, I realize that what I struggled with most at school was the uniformity of thought and the unwillingness to question the status quo that the teachers demanded from us. The rules were understood, without being explicitly written down – “never talk politics, even with friends and extended family”; “never be heard criticising Todor Zhivkov,” Bulgaria’s leader from 1954 until his eventual removal from office in 1989. There was always a certain distance between people. What we said at home, mild as it was, could not be repeated outside, which meant always being guarded around others. And that is exactly how the ruling Bulgarian Communist Party (BCP) wanted it.

With sorrow, I see now that my American friends, who grew up on the progressive side of the iron curtain, suddenly have much more in common with me than we ever imagined we would. It is hard to comprehend that the United States of America -- that most coveted destination for young Bulgarians who dreamed of basking in unrestrained freedom, self-made wealth and the coolest pop, rap and grunge music scenes of the 1990s – could be clamping down on self-expression in the 21st century. 

Like me, Americans now know what it is to feel an insidious fear of the state. To experience that ever-present fear of punishment and retribution, a fear that incessantly obstructs and eventually destroys social cohesion. A fear that is evidently penetrating deep within the ranks of even the Republican party. Lisa Murkowski, a longtime Republican senator from Alaska, recently made a startling public admission: “We are all afraid,” she confessed at a conference in Anchorage. A courageous statement that reflects the mood of the nation. A national poll from the Institute of Politics at Harvard Kennedy School conducted among 2,096 18 to 29 year-olds between the 54th and 66th day of Trump’s second term revealed astonishing levels of fear among young Americans across gender and education status. Six in 10 of those surveyed, whether college-educated or not, admitted to being fearful for the future of America.

In Bulgaria, the trust in those around you, which is the social glue in every society, was stripped away, destroyed through the repeated post-1945 purges. Like Musk’s DOGE purges of the federal government across multiple sectors, these had eliminated or rendered destitute thousands of “bourgeois”, police and civil servants, military personnel, workers and anyone who opposed the ruling party. Informants were encouraged, not unlike Trump’s administration threatening government workers to either report DEI initiatives within their departments or face the “consequences”.

The news of immigrants being deported to El Salvador despite having no criminal records, as well as the recent disappearance of a Venezuelan legal immigrant who had been detained in Texas reminded me of Bulgaria’s Belene labor camp, an island on the Danube whose existence I only learned about long after the communist regime was gone. Thousands of people targeted by the regime were marooned there over the decades, sometimes disappearing altogether, never to be seen again.

Fear of the state affects everything, every relationship. I know, because in my adolescent years it even crept into my relationship with my late father. The son of ethnic Bulgarian refugees from Greece, who had settled in a small southern Bulgarian town in the early 1900s, my father finished his professional career as an ambassador, which placed our family within the small minority of privileged Bulgarians allowed to travel abroad.

Like all those in governmental or high-profile jobs, my father was a member of the BCP. But he was also a compassionate man who truly believed in the ideals of equality and social justice. Unlike many others, he did not use his status to profiteer, taking pride instead in the integrity reflected in our two-bedroom apartment, which I shared with my parents and sister. My parents had no holiday villas, no second flat, and none of the other substantive material possessions typically enjoyed by the nomenklatura.

Kind though he was by nature, my father could be uncharacteristically hard on me. He was particularly critical of my outspokenness and worked hard to tame it during my teens. For years, I took his harsh words at face value and felt somewhat deficient. At the turn of the century, I became one of the hundreds of thousands of young Bulgarians who left Bulgaria to move to the West – the land of freedom, democracy and self-expression. I transformed my deeply instilled feeling of deficiency into hard work and determination to succeed in the most libertarian city of all - London.  I explored unfamiliar ways in which humanity was celebrated in the U.K., including practicing critical and creative thinking, and attending gigs and personal growth courses to name a few. Following a ruptured marriage, I even embarked on personal therapy, which was and perhaps still is a somewhat foreign concept in Bulgaria.  

In therapy I frequently explored the wound that my father’s judgements had inflicted on me, along with my distorted relationship with power, control and visibility derived from the regime with which I grew up. For some time I blamed the patriarchy for my father’s harshness towards my younger self. After all, feisty girls and women have never been in fashion anywhere, at any time.

It was only recently that it dawned on me that this was far from being the whole story. My father wasn’t just conditioned by patriarchy but by authoritarianism too. What he had feared above all was that my desire to name things as they were, to say it as I saw it, would endanger my future in a country that demanded unquestioning loyalty, obedience and conformism. He had been trying to protect me. I was surprised I hadn’t made the connection earlier. As the authoritarian regime in Bulgaria fell at the end of 1989, so did my father’s harsh stance towards my way of expressing myself. He softened dramatically, encouraged me to study, to develop professionally, and travel, his natural kindness coming to the fore as he got older.

Since Trump returned to power in January, many journalists, columnists, political pundits and academics have been stunned by the speed and brutality with which he has grabbed American society by the scruff of the neck and is marching it head down towards what some call authoritarianism, others autocracy, competitive authoritarianism, oligarchy,  patrimonialism, kleptocracy or more pejoratively kakistocracy. Whatever the exact version of the oppressive regime Trump is thundering towards or will be allowed to settle on, the one thing he is already circulating is the currency of fear – the currency in which all authoritarian regimes trade.

To succeed, repression requires submission. What more efficient way to achieve it at national scale than by instilling widespread fear of loss of income, status and freedom, and personal reprisal? In the words of the prominent Bulgarian political commentator Ivan Krastev: “Make people fear the future and democratic institutions are paralysed.” Once fear sets in, the boundaries that protect us from the state’s all-encompassing control can completely crumble.

In authoritarian Bulgaria the state held sway over how you looked, what you learned, and how you behaved, all with a view to ensuring that you complied with the party’s need for a surrender of individual agency. My friends and I still lived our teenage lives, fell in love, slacked on homework and had fun, but we, and our parents, were always looking over our shoulders.

To avoid the danger of any form of organised resistance or independent thinking, extracurricular clubs, beyond the odd choir or orchestra, did not exist in our high schools. Art and music and critical thinking were not part of the curriculum. What was mandatory, however, was introductory military education (IME) in which students were taught how to handle a Kalashnikov.

Reading through the journals I kept between the ages of 16 and 18 has revealed many of the tensions I held deep inside. Amidst the predictable descriptions of my relationships’ peaks and troughs, I discovered much yearning for freedom and longing for resistance and courage. I also discovered fear, humiliation and disempowerment - the polar opposites of freedom and courage. The humiliation and disempowerment did not belong to my generation, but had been inherited, creeping into my worldview through the buried experiences of those before me. My 1989 journal was peppered with quotes from books I had read, alluding to freedom and courage or fear and cowardice:

 “If I am fear-struck and sensible enough

And yet I still die

Do not look for bullets in my skull.

Do not look for a knife in my belly.

Do not look for potassium cyanide in my blood.

Pay attention to my knees.

If you find scars from crawling –this was my death.”

[my translation]

I had copied this from the 1962 poem “The Real Death” by Stefan Tsanev. 

A Bulgarian saying warning against resistance also found its way into the pages of my journal: “Many ahead of their time have been forced to wait for it in very uncomfortable places.” Another Tsanev quote also warns of the cost of rebellion: “The murdered quietly lay under the pedestals, the murderers stood on the pedestals.” But I also copied down a Bulgarian saying condemning the meek acceptance of one’s fate: “Like a bomb hidden in your pocket, silence is dangerous.”

In recent years I have been pondering the damage that Bulgaria’s almost half-century of authoritarianism (preceded by centuries of enslavement under the Ottoman empire) has caused subsequent generations. The three greatest barriers to societal and individual flourishment I have identified are these: the inherited terror of visibility, passed down through the generations, that perpetuates self-repression; the severed trust in institutions and each other which makes democracy permanently volatile; and the underdeveloped ability to ask each other meaningful questions for fear of “prying”, which is a prerequisite for intimacy and social cohesion. Sometimes I close my eyes and fantasise about where Eastern European societies might be if they hadn’t inherited authoritarianism’s straitjacket.

And then I turn my gaze to the U.S. in the hope that this traditionally free society can avoid this crushing straitjacket, no matter how bad things seem now. Having grown up in a regime which institutionalised voicelessness, I find myself in imaginary dialogue with all Americans, and my friends in particular, pleading with all those who understandably feel fearful, worried and consequently apathetic not to mute their voices just yet.

Having lived through authoritarianism with its controlled planned economy, I remain optimistic that the US, the oldest democracy functioning within a free economy, is well placed to resist the Trump administration’s brisk march towards authoritarianism. This would require more individuals, whether CEOs, academics, lawyers, business owners, news journalists, ordinary Americans or any other civil society actors, to be brave and to choose to resist (overtly or covertly), despite feeling fear. In fact, robust research of over 300 violent and nonviolent campaigns from 1900 to 2006 which resulted in government overthrow or territorial liberation shows that a successful campaign for political change requires a remarkably small proportion of the population: just 3.5 percent. In the US this would still amount to over 11 million people mobilising.

It’s been rewarding to witness the power of the free market economy and the voice of the consumer in action in the United States. They have already made a difference by punishing Elon Musk’s Tesla for his widely damaging leadership of DOGE. Market analysts have recently concluded that the 71% year-on-year drop in Tesla profits has been driven at least in part by Musk’s role in the White House, causing a branding crisis for Tesla. Consequently, he will be curtailing his role in DOGE which is exactly what those giving up their Teslas or Tesla orders wanted. This development could have never happened in any planned economy, like the one in Bulgaria during the second part of the 20th century. I hope this news serves as a strong impetus for ordinary Americans who deem themselves powerless to take a stand. For example, what better way to resist than supporting the free press by donating/subscribing to news outlets or to non-profit organisations like CPJ and ICFJ whose mission is to protect press freedom and the truth. In an act of defiance, Sheryl Crow not only publicly discarded her Tesla but also chose to donate to NPR who have been continuously attacked by Trump’s administration.

Under deep state surveillance, you learn not to ask questions or share much about yourself as a way of staying safe. Now I consider it a joyful expression of a free existence to ask questions.

In hindsight I realise that what helped my parents to not profiteer from the corrupt communist system was having moral clarity and actively choosing to act with integrity. In the current context this means choosing whether to be a Harvard or a Columbia University, a Murkowski or a silent Democrat or Republican senator. For remaining neutral is choosing a side, the enabler’s side. The anti-democratic assault Trump is inflicting on American society cannot survive without the apathy of every citizen who chooses to remain silent. To feel more resolute I remind myself of Martin Luther King Jr.’s wise words that “our lives begin to end the day we become silent about things that matter.”  

One of the most efficient ways in which authoritarianism in Bulgaria managed to maintain obedience was through destroying the existence of small communities. Those who were afraid, worried, or anxious lacked not only town halls to turn to but also local communities where they could just speak to one another. We had no way of finding out what the true preferences of those around us were because we did not meet regularly in bigger groups. So to me, the single most defiant and joy-inducing action an American citizen could take would be to create or participate in activities that strengthen social cohesion at the local level. Whether it’s joining local community social events, choirs, sports activities, arts or other clubs, participation strengthens the social glue that keeps democracy alive at a grassroots level and has the potential to weaken false narratives and government control.

Whenever I went back to Bulgaria during my first decade of living abroad, I was often surprised by how few questions everyone asked each other. At times I felt frustrated and was judgemental, rolling my eyes every time I heard someone admitting to not having asked an important question for fear of being deemed nosy. I had mistaken this underdeveloped skill to ask questions for a lack of interest in those around them. Until one day I realised that this too had been a legacy of authoritarian times. Sharing or finding out the “wrong information” in an era of deep state surveillance could cost you your freedom. You therefore learned not to ask questions or share much about yourself as a way of keeping yourself and your family safe. This insight ignited my passion for deep conversations. Now I consider it a joyful expression of a free existence to ask profound questions. In times of a heightened threat of authoritarianism, asking deeper questions is a way of truly understanding yourself and connecting with those around you. Practicing the art of conversation is a defiance of authoritarianism.

Being creative, producing any form of art (and yes, everyone is intrinsically creative!) and supporting arts institutions is another powerful form of resistance against authoritarianism. To keep us subservient, my generation of Bulgarians were deprived of the opportunity to express themselves creatively throughout high-school education. This came at a high cost to us all, the cost of believing that being creative was the preserve of the lucky few.  By its very definition, creativity resists conformity and repression while neuroscience tells us that creativity is also an antidote to anxiety. Embracing our creativity is a way of maintaining a free spirit.

The lack of freedom of speech in authoritarian Bulgaria was reflected in the news media being reduced to a propaganda machine. Its sole role was to legitimise those in power every day and in every way. For this reason, I feel a twinge of sadness every time I hear my friends anywhere in the world voicing their temptation to completely switch off from the news. Knowing the truth is not a given, but a consequence of tenacious and hard-fought journalism operating in a functioning democracy. Turning away from the news is exactly what authoritarian leaders like Trump want us to do because it enables them to act without restraint. While I understand the need to limit the consumption of breaking news as a way of protecting our mental health, I know too well how profoundly discomfiting a world with no truthful news can be. Not switching off the news is perhaps the most subtle yet powerful way to defy authoritarianism.

Like many around me, I too sometimes find it challenging not to feel defeatist and to remain hopeful for the future of my children. When such moments descend on me I take solace in their transience and, more importantly, in history. I look back and remind myself that no dictator, tyrant or autocrat has ever irreversibly crushed the human spirit or won the long-term battle for a better world and greater justice.

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