Billions of people share one massive problem – accessing the financial system. Those in developed countries perhaps take for granted their ease of being able to deposit funds into a bank and take advantage of traditional financial services. Many parts of the world experience financial stratification, such as nations in Africa, Southeast Asia, and South America where citizens are not granted these same opportunities. Banks and government regimes can pick and choose who they want to do business with and can even charge exorbitant fees denying billions of people access to the global financial sector.
History has seen this seemingly countless times – Argentina for example has seen hyperinflation events, bank runs, capital controls, and asset freezes. In 2001, Argentina had a massive economic crisis after its Argentine Peso lost its artificial peg to the USD. Exports became non-competitive, there was no independent economic policy, and saw Argentinians withdrawing their savings in dollars and hiding them abroad or under their mattress. The Argentinian government feared a full-on bank run so in December 2001 they instated a new economic policy informally dubbed “Corralito” which restricted Argentinians’ ability to use and withdraw their own money. The overreaching government even “peso-fied” bank deposits and proceeded to devalue the peso economically devastating their citizens.
Venezuela has been trying to beat the effects of hyperinflation for years caused by authoritative currency controls, heavy money-printing, and aggressive deficit spending. Post-independence Zimbabwe’s poor economic policies and corruption caused erosion of their local currency. Bolivia, Brazil, Nicaragua, and Peru all too experienced their own hyperinflationary issues due to government mismanagement and corruption.
Further, over 4 billion people live under authoritarian regimes that use money as a tool for surveillance and state control. Citizens of these countries find their currencies being debased and are cut off from the financial systems. For these people, transacting outside of the government’s influence is the only way to preserve their financial freedom.
Even human rights organizations in Hong Kong or Russia can see funds seized. Activists in Belarus and Nigeria pushing for democracy have had their bank accounts frozen. Banking and ATM systems were disabled during a coup in Burma. Time and time again throughout the world bold authoritarians have crushed the faith of their citizens in the system.
It’s easy to see why citizens and activists of these countries are searching for ways to circumvent the vitiated fiat systems of their nations by turning to cryptocurrencies out of necessity to control their own money. Not your keys, not your coins is a mantra among many crypto natives, and this mantra is especially salient to those in oppressive regimes. Money in the banks, or in the government’s purview is not your money.
However, there’s a new vector of attack forming against these citizens that have decided to take their right to money back – Surveillance. Many crypto users wrongfully think cryptocurrency is free from the prying eyes of others. Public blockchains are just – public. All of your on-chain activity is available for the world to see, even decades later. On-chain analysis systems are improving to a point where crypto users are trivially traceable and governments know this.
They are taking a keen eye to the crypto space and are paying companies like Chainalysis to provide extensive on-chain data reporting.
It doesn’t take much to realize what this overt breach of privacy can do; especially to those in oppressive regimes. Regular citizens and humanitarians alike are at great risk and face financial controls, deplatforming or worse.
Railgun can be a tool to protect these people. Railgun is a smart contract system providing privacy to cryptocurrency and DeFi users via zero-knowledge proof (ZK-SNARK) technology. Thanks to the power of these zero-knowledge proofs, users will be able to transfer assets to each other without revealing amounts or identities.
This in turn provides access to financial security, offering protection to humanitarians and citizens alike. No longer will people have to worry about their transaction being available for anyone who is looking. No longer will citizens need to live in fear of assets being tracked and frozen. Railgun users will be able to build a private balance of stablecoins and other tokens without fear of outsiders gaining knowledge about their funds. Charitable outfits supporting humanitarians won’t have to fear backlash from their altruistic efforts and regular citizens will be able to sleep at night knowing their funds are safe and shielded from prying eyes. All this in a seamless, secure, and transparently easy-to-use interface.
Railgun – Privacy at Rest.