A ride from Tangier, the largest city in northern Morocco to the Spanish enclave of Ceuta takes less than two hours. The border crossing has its own, sleepier rhythm, quite different from the tourist-driven bustle of Tangier. In Ceuta, traders run their errands, Morocco-based expats make visa runs and Spanish people catch ferries to the mainland. On most days, the border crossing seems almost ordinary. The fences, though menacing and topped with razor wire, are less imposing up close and officers make small talk with the expats waiting to get their visas stamped. 

Then there are those days when the routine collapses and Ceuta becomes the center of Europe’s migration debate. 

The territory is a geographic and political paradox. Despite falling under Spain’s — and the European Union’s — jurisdiction, it sits on the northern edge of Africa, surrounded by Morocco and separated from the Spanish mainland by the Strait of Gibraltar. It is an entry point to Europe, yet not fully part of the Schengen zone, requiring additional immigration checks for travelers crossing to the mainland. 

When more than 60,000 people — mostly Moroccan men and teenagers — rushed into Ceuta (almost doubling the coastal city’s population), the images reverberated across Europe. There seemed to be no dramatic buildup to the incident, nor any obvious explanation why thousands of people chose that day to make their way to Spain. 

Europe’s far-right politicians seized the narrative, portraying the influx as an imminent invasion, warning that the men were on their way to “Calais” and “Germany.” Italy temporarily suspended the Schengen free movement regime with Spain, meaning travellers arriving by sea and air would now be subject to border checks. Spain threatened to take “proportional measures” in response and did so at midnight on August 8, when it imposed similar checks for visitors from Italy. 

The standoff between European governments — led by socialist Pedro Sánchez in Spain and conservative Giorgia Meloni in Italy — is not simply a test for European border security. Instead, what transpired in Ceuta poses bigger questions about the shifting nature of state sovereignty itself: How are we to understand borders, if they’re shaped by forces beyond the state’s reach? 

Borders are not just lines separating geographic entities. They are systems built on surveillance, diplomatic bargains and digital networks. Ceuta is the place where all three converge. Its borders, already protected by the sea, have been fortified with steel, outsourced through diplomacy and tested by coordinated rumors.

Steel

The crossings into the enclave are blocked by a multi-layered barrier of fences and wire. Morocco administers a fence separating it from the neutral area between the two countries. Two fences on the Spanish-controlled territory follow, creating an enclosure monitored by the Spanish Civil Guard. The physical infrastructure is reinforced with motion sensors, thermal and CCTV cameras, maritime communication systems and facial recognition technology. 

Even the sea has now been incorporated into the border system. Just three days after the Ceuta border chaos, Spanish authorities installed a 500-metre floating barrier and anchored naval buoys to create another monitored enclosure. 

The EU has funded most of the fortifications. The Border Violence Monitoring Network’s report says that since the construction of Ceuta’s border barrier in the 1990s, the EU has spent tens of millions of dollars to make the Spanish-Moroccan frontier more secure, technologically up-to-date and heavily surveilled. With the recent mass crossing, Spain will now receive additional emergency financial aid. 

Yet, the architecture of physical surveillance, built and re-built with European money for decades, cannot prevent the human cost of attempting to cross a border. In Ceuta alone, at least 100 people died according to local authorities. “The rationale behind increasing surveillance is that you'll be able to save lives and smash the [people trafficking] gangs, right?” asked Nathan Akehurst, who has written about Ceuta’s border for Jacobin. “Where was that in this case?” 

Diplomacy

Akehurst’s question touches upon the human-centered rationale for heavy border surveillance. But there is also a political one. It is not only Spain, as a EU member, that receives funds to manage migration. Morocco has received €427 million since 2015, for migration-related expenses, including technology and training. That’s part of Europe’s wider strategy of border externalization, a practice where Europe moves border control beyond its own territory. 

The practice has been around for decades, but went into overdrive after 2015, when approximately 1.3 million people, mostly from Syria, came to the continent seeking asylum. Many of them reached Europe through Turkey, prompting the EU to strike a deal with Ankara: €6 billion in funds, visa liberalization and EU-ascension negotiations in exchange for stricter border controls and curbing irregular arrivals to Greece. The EU also agreed to resettle within Europe one Syrian from Turkey for every Syrian returned to Turkey from Greece. But by 2020, when the EU failed to resettle Syrians, Turkey’s president Recep Tayyip Erdoğan declared he would no longer prevent migrants from crossing Turkey en route to the EU. 

“Border externalization is basically paying other countries, but also subjecting them, through a carrot and stick approach, to performing functions that are usually performed by a state itself at their borders,” explained Josephine Solanki from the Transnational Institute, an Amsterdam-based think tank. It leaves space for leaders like Erdoğan, Solanki added, to bargain for influence by turning migrants “into political leverage.”

The cost of outsourcing borders is not just material. It is measured in control that Europe cedes to the foreign governments it relies on for migration policy enforcement. 

In Ceuta, migrants claimed local authorities did not stop them from crossing the border. A young Moroccan man told the New York Times a day after the event: “They opened the border and let everyone go by.”

Border outsourcing agreements were made, among others, with authoritarian regimes in Tunisia, Egypt and Libya, where EU funds were used to detain migrants and quell domestic protests, rights organizations say. Alliances with “deeply unreliable and authoritarian actors” in the name of stability, said Nathan Akehurst, “is short-termist, insane and loses Europe any credibility it has left.” These alliances also allow Europe to “shift the blame to the Moroccans, the Eastern Libyans, the Turkish or whoever decides to take advantage of that moment.”

Rumors 

It is yet to be revealed who, if anyone, has taken advantage of the mass crossing into Ceuta. Local and international media have uncovered now-deleted posts that shared tips on routes and equipment for the journey. One of the main networks was called Hrig Sebta network — “Sebta” being the Arabic name of Ceuta and “hrig” being the Maghrebi term for undocumented migrants, literally referencing the burning of identity papers. 

In the wake of Ceuta, European ministers pledged to tackle online misinformation to avoid migration crises, but remained cautious when asked about thousands of posts reportedly linked to Russia. Other theories attributed the crossing to Morocco’s tensions with Spain over its closer ties with Algeria, or to Spain’s position on Palestine.

But those rumors, and what appears to be a weeks-long coordinated online campaign behind them, reveal something deeply human that fences can’t deter: movement that is spurred by hopes for a better life. 

“[The crossing] would have happened anyway at some point,“ Akehurst argues. “There would have been a crossing because all of the circumstances that generate that are already there before someone with a twitter account throws a match on the fire.”

Yet, let’s pause at the match. It’s not about someone with a social media profile creating chain messages. It is about the ecosystem that can jeopardize borders by creating information flows, turning rumors into perceived opportunities.

Moroccan newspaper TeleQuel already published a report about social media posts amplifying the next hrig — another attempted crossing into Ceuta — on August 15. 

When packaged to a hungry audience, rumors carry the currency of truth. They’ve driven migration long before social media was even conceptualized. Now those rumors speed through digital space owned and operated by private companies not prone to accountability and sitting well outside the reach of any single state.

And the EU has understood that for years. “It is necessary to structure the information space, as we have organized in the past the territorial space, the maritime space and the air space,” Thierry Breton, the European Commissioner for Internal Market of the EU said back in 2018. He warned about Big Tech companies treating digital space as a no-man’s-land that they would write rules for. 

The no man’s land between Morocco and Spain appears calmer now. But the turmoil of the crossing revealed a new, digital dimension to border governance. Information has always found a way to spread; digital platforms have given it new channels: ones which allow those behind the information to remain faceless, while the information itself passes from screen to screen. It reaches a boiling point, spills over from the digital space and then can be disappeared, even before anyone has had a moment to scroll back.

The post The manufactured crisis of Ceuta appeared first on Coda Story.

We’re inching forwards through the thick smog that has cloaked Tbilisi for days. At first, I thought it was a kind of blueish, pink winter mist that makes the city feel like it’s in an ongoing sunset, until a friend who smokes told me they’d been having trouble breathing in it.

It’s Black Friday. A journey that should only take a few minutes is stretching past an hour and for the most part, Tsaro and I are sitting in silence, occasionally passing a phone between us to translate the few words we do speak. Both sides of the road are jammed. People are rushing for the deals at CarreFour, she sighs.  

This November day is also the 365th day of continuous protests in Georgia against a government Georgians believe is steering the country back into the Kremlin’s orbit after years of moving towards Europe. Dozens of Georgians are languishing in prison, often in pre-trial detention, for participating. The protests themselves don’t make news outside the country so much anymore. Unless, that is, there is some kind of significant development, like the discovery of toxic WWI-era chemicals used by police in water cannons, the same cannons I watched the police turn on young Georgians for hours last winter.

It was while covering one of these still ongoing nightly protests that I met Tsaro Oshakmashvili, a 62-year-old widow with wayward orange curls. And it was through deciding to remain after the October 2024 election, the one international observers say was marred by serious irregularities, that I found myself reflecting upon what authoritarianism can do to how we relate to one another and the duality of Tbilisi. Georgia now has more political prisoners than Russia per capita, and still regularly features as an upcoming destination amongst many UK newspapers. 

Since our meeting, Tsaro has become a public figure after her de-facto adoption of Archil Museliantsi, currently in jail for allegedly damaging property during the protests. Archil is a 30-year-old-law student who was orphaned at six months old. When the pair first met on Rustaveli Avenue, at the height of Georgia’s protests, he turned to Tsaro and told her he was ready to die for his country.

Just a few days after we met, Tsaro and I were accosted by police. I’d been taking photographs outside the gates of a Tbilisi prison. With some effort, she calmed them down and we walked away with my memory card wiped. We got back into her car and sat in silence. She then turned to me and, even though my knowledge of Georgian is small, I saw the glint in her eye and knew what she was saying; “You didn’t delete them all, did you?”

Archil is serving four years for allegedly setting fire to one of the new CCTV cameras used to identify protesters through facial recognition technology. The video used to sentence him doesn’t contain any trace of his face, though. Just a man in a balaclava and a burning piece of paper. His lawyers argued it wasn’t enough to identify him, but he was found guilty anyway. After receiving his verdict, Archil was told he could request a presidential pardon. His reply: “What President? Do we have one?” 

Tsaro now spends her days campaigning around the country in Archil’s name, encourages him to make use of his sentence by pursuing his law degree, and brings him supplies in Gldani Prison. The three books and the tracksuit bottoms on the backseat of the car are for him. 

When we finally arrive, I get out of the car and notice the huge sky and the quiet. Tsaro points towards an empty field with a mesh of electric poles running through it, the city a hazy silhouette in the distance. "That's Archil’s view," she says, and pauses for a moment. 

We go through security, stepping over a sleeping dog, and enter a room divided by large steel bars with an x-ray scanner running through. Archil’s things can go forward, but we cannot. As a non-blood relative, Tsaro has no visitation rights. So we watch on in silence as the items slowly travel through the scanner. It will be three more years until Tsaro and Archil can be in the same room again. It will also be the fourth time they’ve met. 

Later that night, a crowd gathers at Tbilisi State University. An explosion of flares and music signals for the protest to begin. Tsaro marches at the forefront behind a huge banner. She smiles and waves at the camera, her way of signaling to Archil that she's watching him.

I walk with the crowd, face hidden by sunglasses and a cap: enough to not be picked up by facial recognition, but hopefully not too much to violate recent laws that prohibit concealing your face.

Afterwards, I meet a group of friends who have gathered at a nearby bar. A man who is visiting from Argentina is wondering about whether to move to Tbilisi permanently, telling me what a fantastic place it seems to be. I tell him he should, then step into a sideroom, and watch on in silence as two men make use of the empty space to dance.

It’s strange to arrive in a place at such a high-stakes moment and only realize what that means as it happens. From the beginning, Georgia asked little of me and gave everything back in return, operating on such frictionlessness that meant I barely had to ask what it was that I was doing there. Perhaps the same reasons I first started to love it were the same reasons vacationing Russians had during the Soviet Union; myths of the eternal host and a perceived openness to strangers, though that "warm welcome" had started to wear thin. But this wasn’t something I initially stopped to ask myself — this question of Russia’s colonial relationship with Georgia, its occupation of Georgian land, and the influx in 2022 of tens of thousands of Russians fleeing mobilization and war with Ukraine.

Shortly after arriving, I found myself in a reality that held little regard for tomorrow; people of all nationalities — Georgian, Russian, Ukrainian, Belarussian, European, and others — turning to the present moment as a form of coping. But although I sensed that people were escaping, avoiding, I was still doing the math on who was fleeing what, exactly. It would still be many more months until I learnt the difference between what it means to confront oneself versus one’s oppressor and what we owe to the places that receive us.

But the thing that provoked me to start wondering about such things wasn’t Georgia’s existential fight against Moscow. It was a relationship with somebody who was fleeing themselves.

A friend had suggested I come to Tbilisi, proposing that Georgia could make a good follow up to a story I had recently finished about Ukrainians starting a new life in the UK. I spent the first days in the company of international correspondents focused on the upcoming election and what it would mean for the country. Drink in hand; the conversation usually concluded with how much they loved it here and when they were flying out again. I listened, sheepishly, unable to venture an opinion and not clear about what a return to an authoritarian past would look like in practice.

As the days crept forward, I couldn't have said how long I would stay, but my neighbor never asked anyway. Iskra was my age. Her dog, Riri, liked to nap on my bed. Ours was the last of a remote cluster of homes with balconies fashioned from old scraps of wood and living room furniture arranged haphazardly on the street. It was one of the highest points in the city before it gave way to rugged mountainside. The only traffic that went by here was the funicular and the tourists who gawped out of its windows. 

Without saying too much, Iskra and I were getting to know each other, sitting on our shared patio with the city, a dark twinkling pit, below. Between us, a favorite topic was emerging; Georgia, its unpredictability, and a feeling of being at odds with the places we had left behind. Iskra was born in the Uzbek Soviet Socialist Republic and had moved to Amderma, Russia's northern coastline, where her mother had worked as a geologist. The war had made it clear to her that she would not be returning. I was still ambivalent about what it was I carried with me from my own homeland, what that counted for in Georgia, and the idea of returning. It was Iskra who first explained to me the origins of Georgia’s resentment towards the Russians that had moved here after the war. That I was learning it from a person who had spent most of their life in Russia might have felt more ironic, had she not said it with such conviction.

After February 2022, Tbilisi was flooded with people coming over Georgia’s northern border, their arrival enabled by the ease of remote work which muddied the water between dissidents, draft dodgers, those looking for an easier life, and plain wartime tourists.

In the early days, more than 10,000 people might have arrived in a single day, a rate that wouldn't go unnoticed in Tbilisi, a city with a population of 1.3 million. Some pursued anti-war activism, others opened bars catering, at times, to an exclusively Russian clientele. As rents jumped and Russian echoed through the streets, local resentment simmered.

When Russia launched its full-scale invasion, many Georgians recognized themselves in Ukraine. And now, with so many Russians in the city, could Putin use their presence to justify another special military operation and "liberate" Tbilisi, too? Or, would the Georgian government align itself so closely with the Kremlin that he wouldn’t have to?

Georgian Ministers debated what to do. Should they restrict entry, like they had in the Baltic states, or allow people in, fearing that turning them away would simply deliver them back to Putin's army. Meanwhile, locals took matters into their own hands, some venues insisting you could only enter if you recognized Russia as an occupier, requesting that people sign a physical declaration. But attempts to sort so-called "good Russians’" from "bad Russians" amplified hatred, with one venue who employed such policies undergoing cyber attacks from a far-right Russian group as a result. Eventually, some gave up and went home, tired of having to prove themselves the "good" kind, while Georgians endured a crushing gentrification from the very same country whose legacy they had been fighting since the Red Army invasion of 1921.

Arriving abruptly from the UK put me in an unusual position — naive enough to move between worlds without being in the firing line, and outside the divide enough that, in time, I would start to see the particularities of it clearly.

One evening, I was on my way out, looking for something to eat. Iskra was smoking on the patio.

“I’ll join you,” she said.

We descended into the city, the street lights casting a deep amber glow over its surface like dark honey, and arrived outside an Italian place. Amid the chatter, there was one man sitting alone, an untouched plate in front of him. Iskra knew him from somewhere, and the two of us slipped into the empty chairs beside him. 

After a few short words between the two, the man turned to ask me where I was from. When I told him London, his eyes widened “Oh, London? I love this culture,” proceeding to talk endlessly about the 2008 electronic music scene, naming bands I thought I had forgotten, reviving a curiosity I hadn’t felt in some time.   

“OK,” he announced, standing up as abruptly as our conversation began. “I will go to The Creek. I hope you will join me there for a drink.” And we did, entering through the double doors, passing the bar, to find him sitting in the courtyard beneath a fig tree. There we spent the remains of the evening listening to him talk about growing up in a remote Siberian town, the concentration of wealth in Russia, and the challenges of throwing parties in homes that can only fit 20 people. Iskra's eyes glazed over. Not mine.

Two nights later, I met Kostya again. From the beginning, I had questions. What was he really doing in Georgia? Did he leave Russia because he was against the war, or because he didn’t want to be sent to the front? Should he be actively helping Ukraine? What does he owe Georgia now that he is here? But I didn't ask them outright, waiting to see instead of hearing it and resonating with a person who, like me, was fueled by restlessness.

We spent the evening moving from place to place — first a wine bar, next a red-lit basement. He was unable to stay in the same spot for more than 45 minutes. Each time we took a seat somewhere new, he began talking with the same fervor as when we first met; telling me about his childhood pets, cleaning toilets throughout his military service, a brief employment stint doing social media for a local environmental ministry, before realizing “what it really was,” being cheated on by his childhood love, and cheating on all his loves since. Each of his stories is a portal into a parallel world, where words make sense, but the context they operate within does not.

It’s not until we’re sitting on the pavement outside an overspilling bar that I really start to notice him; his box shaped jaw, his eyes that stare upwards from the way he tilts his head forward when he speaks. His accent makes each syllable heavy, like a thud, when suddenly he asks if I want to go somewhere else. We do. And when I announce that I’m done for the evening, he walks me home, to the very top of the city, to a final and precarious footpath that weaves over the mountain side before landing outside mine. We hug, awkwardly. Kostya has already started to walk away when I realise how much I’ve enjoyed his company.

“Thanks for a great night,” I shout. 

“Pfff - thank me?” he replies, turning to address me and walking backwards as he does.   

The following few days run like a strange clockwork. We meet most evenings, at the same time, in one of a handful of places. This, I never questioned. Instead, I relished in feeling like I had found a side door into a place I was still figuring out – meeting people of multiple nationalities in a single night, unable to tell who lived here and who was passing through; though it didn't seem to matter, and no one thought to ask.

“Let’s go to Pith,” says Kostya.

His friend, Artur, a Russian guy of Chinese descent is standing behind the bar dressed, as he usually is, in an oversized checked shirt. The place is empty aside from the three of us and it’s gone closing time. 

“I would like to go to Thailand,” says Artur, drink in hand. 

“Pfff. Thailand? Really? Come on man,” replies Kostya.

“Yes - really. I’ve had enough of this city,” says Artur, slamming his glass on the table. “We’re fucking three hours away from Russia right now. In October, this place is going down. Georgian Dream is gonna get re-elected and Putin will use the country as his playground. I don’t want to be here when that happens.” 

“So, what do you want to go to Thailand for?” asks Kostya. 

“Bro, I’m Asian. I just want to go somewhere people aren’t gonna look at me twice, where I can start a business and live in peace. Plus, I can’t be dealing with the situation between China and Taiwan. I’ve just left a war. I don’t want to be anywhere near the firing line when China invades and the US starts sending over nukes. I want to be sitting on the beach smoking a huge, fucking joint.” 

A few days later, a friend learnt I was in Tbilisi and insisted I meet his friend. I went without Kostya and found myself sitting around a table in the company of Georgian women, many of whom had recently moved abroad, making idle chit-chat over a table of food. A woman to my side gave me a list of things I had to see and do, telling me how often people fell in love with her country and decided to move here permanently. I asked why she left and she went stiff; “it’s different if you’re from here.”  

Another woman turned to me; “So, tell me where you’re staying.”

When my attempts to explain to her were unsuccessful, she pulled out a map on her phone and handed it over. I looked at the screen. Half of Tbilisi was covered in red crosses.  

"Don’t worry," she told me, seeing my eyebrows furrow. “Those are just the businesses owned by Russians we avoid,” before telling me that I must get the same app myself.

I took a closer look. Half the places Kostya and I went were each marked with a red cross. I imagined myself trailing around that map, Kostya at my side, a red cross following us everywhere we go. 

After that night, the writing on the walls, that's become as staple as the buildings themselves, took on a new immediacy. 

“Fuck Russia.”

“Russia is a terrorist state.”

“Russian’s go home.”

“You’re not refugees.”

The city starts to slow as the weather gets hotter. So hot, that even the crickets give up their ceaseless chirping and the smell of trash cooking inside their bags waiting to be collected taints the air.

Iskra and I are sitting in the patio eating watermelon until she suggests heading to a party being held at a nearby dog shelter, the intention being for dogs to leave with new owners. As we approach the fence dividing our place from the sloped wasteland, we’re hit by a smell so rancid that it stops us in our tracks. We cover our mouths, struggling to catch our breath between the chokes and sputters.

“I can't,” Iskra says, shaking her head, her voice muffled. 

Then I glance up and see it: a black cockerel, lifeless, hanging from a tree, a shoestring knotted tightly around its pale foot. Its head tilts to one side, its wings splayed open, motionless in the breezeless air.

The two of us stand there, before Iskra whispers 

“It’s a curse.”

Soon after the black cockerel appears, Iskra moves out, opting for a house on the other side of town that she shares with a Georgian family. We continue to meet. One night, we’re sharing a meal, when she announces she’s leaving. I message Kostya who is at Pith.

As I walk across town, the night is indistinguishable from any other. The city's old stone buildings and cracked pavements are dimly lit by the same amber streetlights. The same hum of nightlife whirls in the background, as people move onto their second, or third, venue for the evening. But tonight, it feels muted, like a party winding down before ever really beginning. Clusters of people stand outside bars, their mouths moving, but faces vacant. 

I can’t tell if anything has really changed, or if I’m just imagining it. Earlier that day, a piece of legislation had come into effect. The Foreign Agents Bill meant any organization receiving more than 20% of its funding from overseas would have to register as “pursuing the interests of a foreign power.” It’s a clever, simple law, lifted from the Kremlin, giving the ruling party power to shut down media, evacuate NGOs, and silence activists. Violent protests to reverse the bill in March 2023 were successful, only for the bill to resurface. This time, the bill passed. This was not just a law. It was a signal that Georgia’s government was importing the Kremlin’s operating system. 

A few days later, Kostya is staring at me from across the table, hardly blinking as he smokes. I stare back, not really seeing him, half wondering if the past few weeks are just something I made up in my head. I’m leaving tomorrow. 

“You know, I really don’t know where I am going next, or what I am going to do. Sometimes I think I also want to go to Thailand,” says Kostya out of the silence. 

“I’ve been accused so many times of being some kind of bad guy here. The amount of times I’ve been made to say "Putin is a dickhead," just so that I can order a beer. I know what's happening in Russia is a lie, but still, I can’t just abandon it. I have to protect it.” 

“Why, though?” 

“Because,” he says. “I have nothing else.”

“They were cold winter days. I put on a coat, and went to the rallies, for the sake of the children” 

— Tsaro Oshakmashvili.

As Election Day, October 26, 2024, approached, Georgia’s State Security Services went on Facebook to warn of an impending Western coup, and a plot to assassinate the billionaire founder of Georgian Dream and former prime minister Bidzina Ivanshvili. A pro-Western elite was supposedly preparing to topple the government and drag Georgia into war with Russia. Outlets that spread Kremlin narratives picked up the story, adding one detail: only Russia — and Putin himself — could prevent such a coup from occurring. I had been back in the UK during the run-up to the elections, and when my flight touched down in the city of Kutaisi on the night Georgia went to the polls, I turned on my phone to find both Georgian Dream and the opposition coalition claiming victory. 

As we shuffled off the plane, a man asked where I was headed. I say Tbilisi and he asks if I wanted a ride with his friends: a motley crew of Georgian and Australian men, each dressed in a version of a navy puffer jacket. When it turned out there were no buses this time of night, I said yes.

I sat up front next to a man called Tornike. I had him pegged as 45 and Iwas shocked to learn he was actually my age. I ask who he voted for. 

“Please” he said in a low, nasally voice. “I didn’t bother.” 

“Why?” I ask. 

“It’s lose-lose either way. Politicians just want money. I’m 31. I’ve got - what? Forty, fifty, years left. I’d rather just enjoy my life.” 

I stepped out of their car and into the bitter wind on Rustaveli. Tbilisi was quiet. Somehow the lights felt more grey than amber. A lone car was driving up and down the broad central drag, blaring its horn, a Georgian flag billowing from its window. A group of men loitered on the empty street and cheered each time a car passed and then returned to standing in silence. 

The next day, I go for a walk. Everywhere I look, I see a city void of life, of people. I message friends.  The only person who wants to meet is Dato, a sparky 24-year-old I got to know over the summer. He picks me up in his car. We tear through the city.

“This government doesn’t give a fuck,” he says, barely breathing between his words. “There is no other way but to do another Maidan. But I really hope I’m wrong.” referring to the 92-day-long pro-European protests in Kyiv’s central square which led to the fall of the then government, the annexation of Crimea just weeks later, and the death of 103 protesters. 

In just over a month's time, Dato will be arrested as he leaves a friend’s house and, later, flee the country.

We go to meet his friend, a successful restaurant owner who tells me he’s ready to pack it all in and leave Georgia for good. It’s not about fighting, it’s about making an exit.

“Will you come back?” I ask him.  

“There will be nothing to come back to.”

Kostya, who’s hosting me, returns at 4 A.M. from a trip to Istanbul. He changes into his pajamas and gets into bed beside me. It’s now been 48 hours since the election result. Evidence of voter intimidation and ballot stuffing starts to mount. Increasingly, it appears the election was stolen. A demonstration organized by opposition leaders is being held outside parliament that evening. I ask Kostya if he’s coming, but he’s going to Pith to see friends. “For my welcome home party,” he says. 

That night, the news coverage shows men holding banners stating “Georgia is not Russia.” Young women embrace amid a riot of EU and Georgian flags; people clutch their hearts as the national anthem sounds. But when the opposition finally unveils their grand plan to fight, the mood changes. 

“Our plan,” they say, “is you.”

Later that evening, I sit on Kostya’s bed while he smokes on the balcony, the cold slipping in through the open door. The harsh overhead light glares above. I tell him about the deflated protest, the sense of hopelessness settling over the city, and the stories of young Georgians planning to leave the country for good.

“I’m sorry, but these people killed my empathy,” he says, stepping in from the balcony.  

I remind him why he came here in the first place, but Kostya waves off my concerns, insisting that life here could never compare to Russia, recounting the stories of people sentenced to years in prison for holding up blank protest placards, for reposting anti-war content online, for replacing price tags at a supermarket with messages to stop the war, or throwing plastic water bottles at police. As if a protest like tonight's would even get the chance to happen in Russia, he says. They'd arrest you the moment you gathered. The police would know before you even start. “Maybe now,” he says, “they will understand what it’s like to be us.”

I spend successive evenings attending protests, interviewing people and taking photographs. I pitch news outlets. One story I have is about members of the LGBT+ community fleeing the country. Only the month before, the Family Values Bill passed which prohibited all pride events and public displays of the rainbow flag, banned gender transition, adoption for same sex couples, and allowed censorship of films and books. The law is an almost direct copy of Russia’s anti-LGBT law. One man told me how he was stripped and beaten by police when they found LGBT content on his phone. Editors express only vague interest. In Tbilisi, history is accelerating. In the rest of the world, Georgia barely registers

I go out with Dato and his friends. All anyone can talk about is the election. “If we lose this, we lose our identity,” says Dato, standing to his feet in an impromptu speech. “Where are the Russians who fled here because of the war? If they came here because of Putin, why don’t they join us in the fight?”

I put the question directly to Kostya the next day, asking him if he thinks it's his duty to join. But, really, I just want him to admit what’s really at stake; that the stories he has been told are a lie, that the same stories are used to justify wars that he can escape, that protecting those stories isn’t really escaping at all, it’s remaining trapped in the same narratives that people on the streets outside are now fighting.

But the answers I want aren’t the answers I get. 

“My country?” he asks, indignantly. “What about Europe? They are the ones making problems here.”

How would I feel, he asks, if Russia started creating bases on the UK’s borders? Just as NATO is doing in Ukraine. It’s strategic, he says, the EU flags at Georgia’s airport, the funding, the way EU leaders ferry themselves in and out of the country and address crowds at opposition rallies, painting themselves as Georgia’s savior. Europe has created this situation, not Russia.

“Anyway, whatever. I just want to live my life. I’m OK with being here and them hating me.”

“But this is the crux of the hate.”

“Let them hate,” he says. “I’m tired of all the fucking hate.” 

When I return, he tells me not to speak, and that we should end it. I glance at the cigarette trembling in his hand and ask for ten minutes alone to pack my things.

The bleakest day yet comes on November 25, a month after the election and the day Georgian Dream members are sworn in. The city is cloaked in wet fog. The protesters’ plan is to block the legislators from entering parliament, but with hundreds of masked policemen forming a wall around the building there is little that can be done. Within minutes, the plastic grinning faces of parliamentarians are projected from live screens, signing their oaths of office. The crowd stands motionless in the rain, wet Georgian flags hung around their shoulders. 

Suddenly, people surge towards the iron fence erected around the building, pounding their fists against it. The desperate hammering brings relief. For a moment, it feels as though something, anything, might finally happen. But hours later, as I file photos from a cafe across the street, people are still banging on the fence, and Georgian Dream has long left the building.

On November 28, the news arrives that Georgian Dream will be suspending EU accession talks, suspending the only future that isn’t linked to Moscow. The response is immediate. Rustaveli floods with tens of thousands of people for a bitter standoff with the police who chase and beat individual protestors into the following morning. They begin to pick protesters off one by one while walking their dogs or collecting their children from school. Each evening, the crowd rejuvenates and the cycle repeats.

Somewhere in the crowd, Archil meets Tsaro for the first time. Together, they endure the cold, the tear gas, the water cannons, the indiscriminate arrests, the raids, the beatings by police. And despite having only just met, what they experience erases the distance between them. "We went through such terrible days… that, of course, there was no difference anymore,” Tsaro later told me. “This was my son. He was a son of the same Georgia.”

By the start of 2025, all major opposition leaders will be arrested; while attempts to legally ban all opposition remain underway today, effectively creating a one party rule. Obstructing the road is enforced with fines or detention, while obstructing the pavement becomes listed as a new offence. A man is charged for insulting the police online. Another is charged with throwing a water bottle at police and sentenced to two years. I think of Kostya's words, that Georgia will never be anything compared to Russia, and don’t feel so sure.

Where does Georgia go from here? Czech MEP Marketa Gregorova recently said Georgia was undeserving of its EU candidacy status and that, with Viktor Orbán gone, there would be no one left to oppose targeted sanctions against officials. Meanwhile, Russia has deepened ties with South Ossetia. Part of the new agreement grants Russian citizens the right to take up official positions in the occupied region. One month after declaring the new partnership, South Ossetia’s Prime Minister stepped down. His replacement; Marat Kambolov, a Kremlin-appointed Regional Administrator. In May, Georgian Dream launched a new unit for monitoring online “hate speech” against officials, with 60 cases already being filed. 

People still stand outside parliament as 118 prisoners of conscience serve out their sentences. Some who continue to protest ask where the younger generation have gone; others say it's the sheer scale of the crackdown and the extended power police have that keeps them away. Just a few weeks ago, a friend told me he was leaving. "Society here is broken," he said. Sitting on our shared terrace, I recently asked my neighbor, in his sixties, if he attended the protests back in 2024. He just laughed. “This is nothing new for Georgia.”

The other day, I passed Kostya in the street. It was the unmistakable sound of British English from the woman he was with that made me turn his way. Two years later, the irony is that perhaps he was right; the younger generation, the ones who haven’t left, say they do have a deeper understanding of what it is like to live beneath authoritarianism — the main difference being that it didn’t cost them their empathy.

When I visit Tsaro at home, she shows me pictures of Archil on her phone, cooing how cute he is, joking that he makes her own children jealous. But I also know that she feels the full weight of this moment from the times that I have seen her cry while reading his letters.

There was something else Tsaro said that day we were intercepted by police, something that surprised me more than her small hope that I’d somehow defied the police.

“You know, not all police are bad. Some are really good people,” she said, using my phone to translate. “I felt sorry for them. They told me we have families, too. If they don’t do something, they’ll be fired and unemployed. That’s why they are afraid.” Then, smiling once again, said she was looking forward to telling Archil the story later and that he would certainly find it very funny.

Tsaro has now spent many weekends campaigning across the country with the Mothers of Conscience, a collective of mothers whose children have been imprisoned for protest-related charges since 2024. One member, Marina Terishvili, whose son is serving two years, lost her other son on the 9th April 1989, the day Georgian demands for independence from Moscow were met with shovels, tanks, and toxic gas at the hands of the Soviet authorities. Many people’s names did not make it into the official tally of the dead that day. They died months after exposure to the gas.

The Mothers often deliver newspapers written by their children from behind bars. I've joined them on these newspaper runs, and recently took a copy with me to translate back home. In it, I found a note from Archil:

“Stand by a stranger, this is what gives me strength and motivation to fight, fight when I see how people care for each other, fight when I see how they support and stand by me, a stranger to them.”

The collective responsibility people take for others, standing by strangers, is something I still see in Tbilisi, even if that community is now confined to the patches of pavement where it is still legally permitted to protest, or to the contents of a package delivered behind bars, or to the sofa in Tsaro's living room, the one that Archil is planning to sleep on when he is released. Such acts of solidarity exist in a space authoritarianism cannot so easily reach: the space between people, another homeland. 

The post  Standing with strangers, a Tbilisi story appeared first on Coda Story.

A lot is written about corruption, but fundamentally it’s about trust and how healthy societies can’t exist without it; and the World Cup has shown what happens when trust breaks down. The decision to allow U.S. striker Folarin Balogun to play in the World Cup match against Belgium was, according to FIFA, made by the relevant disciplinary committee in a routine manner. However, following the similarly generous treatment accorded to Portuguese megastar Cristiano Ronaldo before the tournament began, a lot of people not unreasonably questioned whether the rules were being set aside for commercial reasons.

It’s only football, so does this matter? In some ways, of course not. But I think the episode is instructive of how quickly trust can disappear. No one is under any illusions that FIFA is motivated purely by the desire to spread sweetness and light, thanks to corruption scandals, the grotesque “peace prize,” and all the other nonsense. But previously, what happened on the pitch was assumed to be sacrosanct, which is why these disciplinary decisions mattered more than it at first might appear.

Shortly after the U.S.-Belgium game, Argentina played Egypt, coming back from a two-goal deficit to achieve a remarkable 3-2 victory. I watched the game with my family, and it was notable how — instead of being amazed by Lionel Messi’s wizardry — all of us focussed instead on a refereeing discrepancy that led to a goal for Egypt being ruled out, and a seemingly identical one for Argentina being allowed. 

Previously we would have given the referee the benefit of the doubt: even if he’d made a mistake, we’d accept it was an honest one. But now we knew that the tournament had intervened to keep bankable stars playing for longer, in violation of its own precedents and regulations. Any decision that has that effect, as this one did, was immediately suspect. 

In the past, particularly when living in Russia, I used to hear a lot of Westerners being quite enthusiastic about corruption: it was nice they’d say, if they’d been stopped speeding, to be able to pay the police officer a bribe on the spot, and skip all the annoying paperwork. But that was a short-sighted way of looking at it: once a police officer, or anyone else in a position of power, gives anyone special treatment, then the trust that keeps all our interactions civilised, starts to break down. The more it is broken down, the harder it is to repair.

I am not particularly interested in football (Welsh rugby, on the other hand), which is a game I find both dull and mercenary. Besides, the Welsh team tends not to be very good. But I am interested in corruption, and I was surprised by how angry the Balogun affair made me. If you love a game, you need to hate its arbiters giving out special treatment, even if you are the beneficiary of it. That is a lesson quite a lot of politicians need to learn, both in the United States and elsewhere.

A report from the Anti-Corruption Data Collective makes particularly grim reading in this light. Lobbying by “high-risk foreign individuals” is higher under Donald Trump than it has previously been; the amounts being spent are often obscure; much of the lobbying is to overturn previous anti-corruption efforts; and, most worryingly, efforts are aimed not just at individual cases, but at the whole principle of fighting corruption.

“If these influence campaigns are successful, this sets a dangerous precedent where the standard for holding corruption accountable shifts according to whoever holds power in Washington. For those seeking to undo consequences of their corrupt acts, each time lobbying works, it confirms that there is a price at which these consequences can be undone,” the report notes. So just like football then.

Cometh the hour, cometh the bin

Sunlight, it is often said, is the best disinfectant. Though I don’t know if that’s literally true when it comes to bacteria, transparency is certainly a useful antidote to the kind of backroom deals that make corruption possible. Generally speaking, politicians honour this idea in principle, if not necessarily in practice, so it’s unusual for British far-right politician Nigel Farage to have launched an election campaign on the single issue that he personally should be allowed to keep his financial affairs secret.

All the other major parties have decided to sit this one out until the official inquiry into Farage’s finances is concluded, at which point there may well be another by-election anyway, leaving serial novelty candidate Count Binface to provide the main opposition. It’s odd to think that someone who obscures his face behind a giant rubbish bin and pretends to be a spacelord from the planet Sigma IX could be the voice of transparency, but it’s 2026, and that appears to be where we are. It would be genuinely hilarious if he won.

Of course, while we’re distracted by the attention-seeking behaviour of tiresome bores like Farage, actually important things are happening elsewhere. It’s definitely worth taking a look at this report into the Iranian drone industry, which illustrates how changes in the world economy have led to a weakening of American influence in particular, and Western influence in general.

This growth of a multi-node decentralised trade system is paralleled by the growth of the large and highly-efficient ‘Chinese Money Laundering Networks,’ which operate with the same scale and speed as any large financial institution, and now dominate illicit crypto activity. This is an interesting paper on how military strategists should think about money laundering, considering its significance in allowing adversaries to buy components for drones, and so on. 

We also need to remember, however, that by using money laundering legislation and sanctions profligately, we are lessening their effectiveness by teaching people how to evade them. Like antibiotics, we’ll miss them when they don’t work anymore.

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

The post FIFA’s games betray our trust appeared first on Coda Story.

After kilometers of flat, orange desert, the bus dives down through an increasingly lunar landscape as it reaches San Pedro de Atacama. Amidst the sea of red rocks, patchy vegetation and distant high plains known as altiplanos, a small sign appears on the side of the road. The entry marker has been tagged in graffiti. “Se vendió los salares.” “They sold the salt flats.” 

The town of San Pedro, located in the north of Chile not far from the borders with Argentina and Bolivia, then appears like an oasis. In this hub for international tourism, small buses packed with visitors make trips from the dusty, bustling center to explore the region’s various geysers, sand dunes and volcanoes. Night sky tourism ventures offer a unique look at the southern stars. But it is the vast white salt flats, formed between 100 and 10 million years ago, that people come from around the world to see. 

As tectonic plates slowly shifted, water flowing from the Andes mountains lost access to the sea and settled into a natural drainage area known as an endorheic basin. Here, water evaporated quickly, leaving a white crust of salt on top and below, a rich mélange of minerals – lithium, potassium, magnesium, and boron — encased in brine. The Salar de Atacama is one of the biggest salt flats in the world — and one of the most important.

On March 11, Jose Antonio Kast, Chile’s new president took office. Kast, a conservative ostentatiously close to Donald Trump, has long been a critic of Chile’s national lithium strategy. One of his first actions as president was to sign an exploratory deal with the United States to extract rare earths and essential mirals. Chile, the world’s largest producer of copper and second largest of lithium, is central to the Trump administration’s plans to reduce its reliance on China as a source of the rare earths and metals that are fundamental to modern industry, from semiconductors to electric vehicles to batteries to defense technology.

Even before Kast took office, he attended Trump’s “Shield of the Americas” summit in Miami, an ostensibly security-related alliance that is also an attempt led by the U.S. to curb China’s growing influence in Latin America. Under the previous Chilean government, China had become a dominant player in the national lithium industry, as it had in Argentina. With Javier Milei, a Trump ally, in office in Buenos Aires, having another ally ensconced in Santiago has been a significant boost to U.S. plans to reclaim its role as the overwhelming regional hegemon. It was intervention from Washington, for instance, that led to Chile abandoning a $500 million Chinese telecom deal to link the two countries via undersea fiber optic cables.

Amidst the geopolitical wrangling, though, is the question of who benefits from Chile’s national resources and what impact the relentless drive to extract those resources has on the country and its people.

Sonia Ramos Chocobar sweeps kibble from the small kitchen table of her home on the outskirts of San Pedro and shoos her five dogs and three cats into the yard. Chocobar has just returned home after several days in neighboring Calama – where she was attending the first-ever Salt Flats Conference – and the house is a mess. The climate activist has made time between her afternoon grocery shopping and an evening community gathering to meet with me. 

Chocobar, in her 70s, is a bit of a local legend. In 2009, she made national news when she and another environmental activist (Amelia Mamani, since deceased) silently walked from San Pedro to Santiago, a distance of 1,534 kilometers, to raise awareness about the environmental risks of geothermal exploration near a geyser known as El Tatio — sacred to the Lickanantay indigenous community she comes from. The “march of the grandmothers” was followed by other environmental actions. Most recently, Chocobar walked to Antofagasta, the gritty port town that exports much of the copper, lithium and other resources mined out of the vast expanses of land in what’s known as Chile’s Gran Norte (“Greater North”) region. 

This time her message was different: save the Atacama salt flats.

The broader area where the borders of Chile, Argentina and Bolivia converge is often referred to as the world’s “lithium triangle.” This lost corner of South America is believed to hold 68% of the world’s lithium reserves — a key element in the production of the lithium-ion batteries that fuel not only electric vehicles, but, increasingly, data centers and other large “green” infrastructure projects. San Pedro, roughly in the middle of the triangle, is sitting on a modern gold mine — and a faultline for the future of renewable energy.  

The town of 2,500 full-time residents has long been at the center of a tug-of-war between different actors, all of whom claim sovereignty – dominion – over the salt flats surrounding it: the indigenous communities who have called this environment home for centuries, the Chilean state and the international markets salivating over the “white gold” extracted from it. Over the years, and through much negotiation on local, national and international levels, a sort of entente had been reached: the state owns the resource, private companies exploit it and some of the profits kick back to local communities. Lithium was even granted a special status under a dictatorship-era decree: a “strategic” mineral, only to be mined with the express agreement of the State. The election of Kast has already disrupted this tenuous equilibrium. The Chilean president has removed environmental protections from roughly 40 different types of natural resources — reopening the tap that has long fueled extractivism and inequality in Chile after four years of left-wing, protectionist policies. 

With counter space cleared and the tape recorder set, Chocobar begins to speak, choosing her words carefully and pausing regularly for emphasis. She sounds tired, but steely. “We are always in a constant effort to protect our water, our land,” she tells me. “We have the misfortune of the Pacific. And we have the misfortune that the Salar de Atacama is one of the greatest lithium sources in the world.”

It wasn’t always this way — in fact, the “resource curse” is relatively new, she explains. For a long time, the Atacama desert was viewed by most Chileans as a no man’s land. Growing up as a member of the Lickanantay indigenous community — also known as the Atacameño people — Chocobar learned how to coexist with the harsh environment, rather than to dominate it. How to extract groundwater, which plants to grow, when and where to shuffle crops. “If we are millenary people, it is because we have found many ways to survive here,” she says. “People think the desert is lifeless, but it’s the exact opposite.” 

Over her many years, Chocobar has seen these techniques slowly disappear: dried-up streams, dying flora and fauna, water rerouted from communities to corporations. The natural richness of the desert lands she calls home has been converted into a monocrop for export. The culprit? The world’s increasingly rapacious appetite for rare earths and metals.

Lithium demands huge amounts of water. To extract the resource through a process called brine evaporation, mineral-rich groundwater is pumped from beneath the salt flats at a rate of thousands of liters per second into vast open-air ponds. Then, the water is evaporated to reveal the lithium. 95% of this groundwater — which once belonged to the smattering of 18 indigenous communities that inhabit the region — quite literally disappears into thin air. 

For local communities, the strain is already noticeable. In San Pedro, an estimated 49% of residents don’t have access to running water, says journalist Ernesto Picco. In one town — the ironically named Santiago del Rio Grande — Picco has reported, 100% of residents have no access to water. 

It's not only humans who are being affected. The water scarcity has modified the breeding and feeding habits of alpaca populations, a local llama herder in neighboring Toconao, Hugo Flores, told me. A river used to run through San Pedro. On one of my days in town, I climbed down a ladder and walked across the dried up stream to get a better view of the distant Licancabur Volcano. The caked ground chipped under my sandals.

“We’re sitting on a watershed, and yet there is water scarcity,” Chocobar explains. “We’re being conquered, in a sense — commercially, economically. It is a natural laboratory that is being destroyed.” 

Lithium hasn’t always been so coveted.

When it comes to minerals, in Chile, copper was for a long time — and still is, to a certain extent —king. Since its discovery in the 1880s, the South American country has been one of the world’s largest exporters of copper, which is drilled out of open pit mines in the Gran Norte region. From the window of a taxi in the port city of Antofagasta the day before, I had admired the massive telescopic loading chutes that transport the mineral directly into the hull of boats, releasing brown-gold particles into the air that settles on surfaces — park benches, balconies, cars — across the city.

It wasn't until the 1960s that the Chilean government began to recognize the benefits of lithium after accidentally discovering it buried in salt brine during an exploration aimed at identifying additional water sources for copper mining. The timing couldn’t have been better. “After World War II, there was a lot of speculative value in lithium as a nuclear material,” James J. A. Blair, a professor at Cal Poly Pomona who has published several papers on lithium mining in Chile, explained over a recent video call. 

In 1979, about six years into his 17-year iron reign and following the lead of the United States, which had done the same, Chilean dictator Augusto Pinochet declared lithium a “strategic resource” reserved exclusively for the state — not on account of its economic potential, which was at the time unknown, but as a national security stockpile. 

This seemingly small linguistic tweak has had long-lasting effects. 

After Pinochet’s decree, lithium extraction came under the auspices of Chile’s State Development Agency, CORFO, which started to ink contracts with private firms for further exploration. A year later, CORFO partnered with U.S.-based Foote Minerals to form the Chilean Lithium Company (SCL), in which the state held a 45% stake. 

What began as a Cold War precaution would quietly harden into one of the most unusual resource regimes in the world. By carving lithium out from the standard mining code, written in the 1930s, the Chilean state created a hybrid model. Lithium was not exactly nationalized, but neither was it fully privatized. “Lithium sits in a legal gray zone in Chile,” Blair told me. “It’s formally non-concessionable — meaning private actors can’t just stake a claim the way they would for copper — but in practice, the state has delegated extraction through long-term agreements that are incredibly favorable to a small number of firms.”

During the dictatorship’s wave of privatizations in the 1980s, control over key lithium assets was transferred to a small circle of politically connected actors. Among them: Julio Ponce Lerou, Pinochet’s son-in-law, who would go on to run SQM, now one of the world’s dominant lithium producers.

“Decisions were made in a highly centralized and opaque way,” researcher Gonzalo Gutiérrez told me over cafeteria food at the University of Chile, in Santiago. “By the time lithium became economically important, the institutional framework was already locked in.”

That framework has proven to be remarkably durable. Even as Chile transitioned back to democracy in the 1990s and expanded its role as a global mining powerhouse, lithium remained an exception — governed not through open concessions but through a handful of contracts administered by CORFO. 

In her 2025 book “Extraction,” researcher Thea Riofrancos notes that even today, two firms — SQM and Albemarle — effectively operate as a “a legally sanctioned private duopoly.” Control over lithium, she writes, is a tightrope between “the palpable potential of public control and the reality of corporate dominance.” 

For Ramón Balcázar, the founder of the San Pedro-based nonprofit, Fundacion Tantí, this legal exceptionalism has had profound consequences on the ground. “The state claims ownership, but the impacts are local,” he said. “Communities were never meaningfully included in the design of these contracts, yet they are the ones living with the depletion of water and the transformation of their ecosystems.”

Balcazar’s nonprofit sits on a side street in San Pedro, across from a trendy French bakery called La Franchuteria that sells iced lattes at European prices. 

Since its founding in 2016, Fundacion Tanti’s small team of researchers has studied the effects of lithium mining on indigenous communities in the Atacama desert. The period has coincided with nothing less than an explosion in the demand for Chilean lithium. 

The growth has mostly been tied to a dramatic rise in demand for electric vehicle batteries. Between 2015 and 2024, global lithium demand grew roughly sixfold, largely driven by EV batteries. The boom has fundamentally reshaped lithium markets: whereas EV batteries accounted for only about 15% of lithium demand in 2017, they made up roughly 85% by 2023. In Chile, arguably the world’s lithium breadbasket, raw materials are mined for export but rarely do its benefits trickle back down to communities.

“Where is the lithium going? To Elon Musk?” Daniela Rodriguez, a local journalist and activist I spoke with in San Pedro, asked. “To send rockets into space, to power electric cars that you never even see around here?” 

In 2021, Balcazar and fellow researchers came up with a neat term for this phenomenon: “green extractivism.” “What we are seeing is not an energy transition — it’s an expansion of the extractive frontier under a green label,” he told me. 

Faced with increasing demand for lithium to fuel the “green revolution,” the Chilean state has tried to thread the needle. In 2019, after a wave of mass protests against neoliberal inequality known as “el estallido social” (the social uprising), Chileans elected Gabriel Boric, a young, tattooed reformer who promised to, among other things, reassert state control over the lithium supply chain to redistribute its value. 

“Lithium is the mineral of the future,” Boric said on the campaign trail. “Chile can’t make the historic mistake of privatizing resources again.” His government promised a paradigm shift: more community involvement, more protection of wetlands, greener methods of extraction. Lithium, he seemed to say, would benefit Chileans across the whole supply chain and not just a select few at the top.

In April 2023, the government announced its National Lithium Strategy. The policy sought to expand production while increasing state control through public-private partnerships, renegotiate the contract with SQM (the same private company once headed by Pinochet’s son-in-law) and include community and indigenous participation in future lithium exploration decisions. 

In all, Boric’s government identified 68 salt flats that could be opened to mining exploration, but also 27 wetlands to be protected, Riofrancos, the author of “Extraction,” notes in her book. 

“The national lithium strategy is Boric's most successful policy,” Nicolas Grau, Boric’s former finance minister, told me over the phone. “It will allow Chile to industrialize through lithium — growing the economy while also protecting the environment.” After years of passive control, the state would finally take a more “protagonistic role” in managing the resource, Grau said, without nationalizing it.

To Riofrancos, the juggling act under Boric was typical of what happens when a state tries to pry some space in a market where extractivism has long been left unchecked. “Boric’s blueprint cited Allende as an inspiration, but his approach was more conciliatory toward extractive capital than anything Allende had proposed,” she writes. 

Local communities in San Pedro felt similarly. “The only thing politicians care about is being in power,” Chocobar said in San Pedro. “For all intents and purposes, we might as well not exist.” 

Boric’s successor, Kast has quickly rolled back environmental protections, fulfilling his campaign promises of commercializing mining and partnering with the U.S. regardless of the environmental impacts on the salt flats. 

Jorge Heine, a former Chilean diplomat and expert on international relations, argues that Kast is more constrained than it might appear. “People tend to overestimate how much a single administration can reshape lithium policy,” Heine explained. “This is a sector governed by long-term contracts, by international commitments, and by a legal framework that has proven remarkably resilient. Kast can tweak, accelerate, or slow things down, but dismantling the model entirely would come at a significant political and economic cost.”

But huge costs are already being paid, costs that communities in San Pedro have been living with for decades. Could Kast’s attempts to liberalize lithium mining and potentially exacerbate inequalities and environmental damage galvanize resistance?

For now, the signs of that resistance are still weak: graffiti scrawled on the side of the road, a grandmother walking along a highway with a cardboard sign, four panels of wood hung in a town square. But like lithium itself, transformations tend to take place very slowly at first — millennia of build-up in the brine — until suddenly they happen very fast. From Santiago to Atacama, protesters have been taking to the streets. In June, broader protests against Kast’s dismantling of social programs and services turned violent. 

At some point, austerity for the people contrasted with largesse for mining companies, technology companies and acquisitive foreign powers becomes hard for even a government elected in a landslide to defend.

The post The Chilean curse is its abundance of riches appeared first on Coda Story.

The United Kingdom has taken over the presidency of the Financial Action Task Force, the global standard-setter on tackling money laundering, and seems determined to keep calm and carry on despite the gigantic Donald Trump-sized hole being blasted in everything it’s trying to do.

The new president of the Financial Action Task Force is Giles Thomson, a career civil servant and archetypal safe pair of hands, who’s declared that the organisation’s priority for the next two years is fighting fraud. He estimated the global cost of fraud at $500 billion, which — if compared to the standard estimates of the volume of global money laundering as making up 2 to 5% of everything — means it contributes between a tenth and a quarter of all profits from financial crime.

Fraud is clearly thus a Very Big Deal, and therefore a well-chosen target for Thomson because everyone (including me) agrees that we need to hit it. However, I think I saw a hint of other perhaps more controversial tasks in the rest of his proposed priorities. The suggestion, for example, that the Financial Action Task Force (FATF) will conduct “proportionate assessments of lower capacity countries” looks to me like a recognition that it needs to stop criticising poorer countries that don’t actually launder money just because their legislation isn’t perfect.

This has been a weighty accusation in the past, not least because of the implicit suggestion of racism, made by, among others, regulator Charles Littrell, who summarised the FATF’s great flaw in 2022 thus: “the vast majority of dirty money and assets resides in, passes through, or is facilitated by the world's largest and richest countries. How then do the world's main [anti-money laundering] risk rankings invariably centre blame upon small, relatively poor, and nonwhite jurisdictions?”

This is not an academic question. Being blacklisted by the FATF is serious, and there has been definite unfairness in the past in which countries have ended up being singled out for a punishment beating. Hopefully a recognition of this reality is hidden somewhere inside Thomson’s rather gnomic utterance that “the FATF will support countries and the private sector to focus effort where the threat is greatest.”

Fortunately, the FATF will have an immediate opportunity to demonstrate that it shows neither fear nor favour when it comes to doing the right thing when it publishes the results of the ongoing evaluation of the United States. 

The U.S. was last evaluated in 2016, and the FATF made various recommendations, which Washington was supposed to have implemented within three years, and sort of did. With the passage of the Corporate Transparency Act in 2020, some progress was made, but since Donald Trump returned to the White House that has gone into screeching reverse.

Prosecuting foreign corrupt practices is “not a priority, ”transparency around residential ownership has been suspended, the Corporate Transparency Act  has been gutted, and crypto is everywhere. Above all, of course, the president himself has been making money at a rate that even Vladimir Putin would have to admire. His headline earnings figure —  $2.2 billion in the first year of his second term —  is clearly unprecedented, but so are the details. 

What for example will future historians make of the fact that the president declared his ownership of the trademark for “THINK BIG AND KICK ASS”? Ha, trick question, there won’t be any historians. They’ll have been replaced by AI.

Tether watch

Talking of history, I had slightly been hoping that the U.S. dollars in circulation might hit the appropriately round number of $2.5 trillion to mark the round 250th anniversary of the Declaration of Independence, but it was not to be. If only the Fed had launched the $250 bill in time, perhaps it would have got there, but we’ll just have to wait.

Meanwhile, there’s an interesting time ahead for Tether, this newsletter’s favourite cryptocurrency, which is sailing into choppy waters. It has decided to pull its USDT out of the European Union rather than to comply with the Markets in Crypto Assets regulations on stablecoins, which is a boost for its great rival Circle (USDC), which is very much available in Europe. 

The two big stablecoins have markedly different strategies: Tether is dismissive of regulators, while Circle cosies up to them. And now here comes a new rival in Open USD, which is backed by many of the world’s largest banks and tech firms, and which also promises to abide by everyone’s regulations. Is Tether at risk of becoming irrelevant?

Congo’s conflict coltan

Huge credit to the good folks at Global Witness for this report from the Democratic Republic of the Congo, where coltan smuggling is helping to perpetuate the grim conflict in the east of the country. It is the kind of methodical, thorough research that really helps open your eyes to how grim things can be, and how complicit the rest of us are in a global supply chain forged from conflict. 

Congolese people hack coltan out of the ground under the eyes of M23 guerrillas, who then smuggle it into Rwanda, where it is repackaged as Rwandan and given certification intended to show it’s not from a war zone. It is then shipped to refiners in China or Kazakhstan to be processed into tantalum, which is in turn sold to leading companies to be incorporated in the phones, tablets, jet engines, and other products that we all rely on for our lovely modern lives.

“Rwandan official figures show that coltan exports have increased more than 2.5 times between 2021 and 2025,” the report notes. “Coltan is an important revenue stream for Rwanda, which levies a 5% tax on exports. Since 2023, it has become the country’s second-largest export earner, after gold.”

And where does the gold come from? Also from the Congo, which is why the U.S. Treasury sanctioned a Rwandan gold refiner last month, following action taken by the European Union against the same company last year, but it has done little to rein in M23.

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

The post Holding the U.S. to account, Tether exits EU & Congo’s conflict coltan appeared first on Coda Story.

I was listening to Ezra Klein interviewing a left-wing Democratic Party strategist the other day about what a post-Trump U.S. foreign policy might look like, and it was a pretty striking demonstration of Europe’s irrelevance right now that the only Western European country mentioned in the 90 minutes of the chat was the UK, and that was solely in the context of how it helps kleptocrats.

But aha, a notional Brit might have replied, at least we are about to convict Diezani Alison-Madueke, former head of OPEC, ex-Nigerian oil minister, for her alleged egregious corruption. That notional Brit would be feeling pretty foolish right now though, because this was yet another flop, with her being acquitted on all charges. 

Britain has a dire record both when it comes to enabling corruption and when it comes to successfully investigating it, as the failure of yet another high-profile prosecution shows. This latest fiasco should be the impetus the country needs to at last provide the resources and officers that its law enforcement agencies require.

Alison-Madueke saw the hand of divine providence in her acquittal. “It has been a hard journey,” she said, “but I tell you this, God will always do as he will. God will be God and God is not a man that he should lie; when he promises you something, he will see it through” — and who am I to say that she’s wrong? However, there are other potential explanations for what has happened beyond the Almighty manifesting at Southwark Crown Court to give instructions to the jury, including the entrenched incompetence of British police agencies.

It’s hard not to see a parallel with the failed attempt six years ago to investigate Dariga Nazarbayeva, daughter of the former president of Kazakhstan and possessor of a reasonable-to-large London property portfolio, which saw the National Crime Agency (NCA) being comprehensively outwitted by defence lawyers, just as it has been again.

“Today’s verdict is a major blow for the NCA who have come away empty-handed in one of their highest-profile corruption cases, which took over a decade to progress to trial,” said Zainab Saleem, Legal Fellow at Spotlight on Corruption. "It is vital that the UK government properly resources law enforcement agencies tasked with investigating complex bribery and corruption cases and does not take this defeat as grounds for rowing back on anti-corruption enforcement.”

It will be interesting to see what, if anything, results from the suggestions that the new Supreme Leader of Iran has been moving his wealth merrily around with the help of various Western banks, all of it now being investigated by the U.S. Department of Justice. “Funds for the transactions have been routed through financial institutions in the UK, Switzerland, Liechtenstein and the UAE,” reports Bloomberg.

What is the answer? Whatever it is, it will be even more embarrassing for the UK if it doesn’t come up with something plausible by the time it convenes its Illicit Finance Summit in December. (Unless it ends up being rescheduled again, like one of those meetings that no one actually wants to attend but also no one wants to be responsible for cancelling.)

Still, credit where it’s due, at least efforts to improve Companies House — the UK’s formerly-disastrous corporate registry — appear to be finally bearing fruit. It has sent almost a million enforcement letters to people who haven’t verified their identity, which must have been — at the very least — a useful money-spinner for the post office.

The idea of increasing funding to law enforcement agencies is something that Americans would do well to consider too, particularly when it comes to the Internal Revenue Service. “In 2022, under President Joe Biden, Congress approved an $80 billion increase in IRS funding over a decade, with more than half of it slated to restore the agency’s ability to go after the super-rich. This victory was short-lived. By March 2025, Republicans had slashed that $45.6 billion enforcement budget to just under $4 billion — “a 91% decrease,” it notes in this fascinating book excerpt.

I have been interested for a while in the idea of government’s being engaged in “legalisation by under-enforcement,” which is something we see with tax evasion, pollution of waterways, and almost anything else when the rules not being enforced benefit the kind of people who donate money to political parties. But I need a better name for the phenomenon, so please help me out and send one in.

Talking of phenomena that we need a new name for, Elon Musk’s wealth is doing weird things to the Forbes billionaires list. Whoever runs it appears to have decided to only display his net worth to two significant figures. That means that, while we can see an assessment of the wealth of relative paupers like Sergey Brin to the nearest $100 million ($277.6 billion, as I write), we only get a round $1.2 trillion for Musk. Or a round $1. 4 trillion, depending on what day it is, which means his wealth jumps up and down in a minimum increment that, on its own, would be sufficient to make its possessor the richest person in every country in the world except Spain, Canada, Mexico, the United States or France.

And talking of France, the G7 summit in Evian is over. It was of course at a previous French G7 summit when participants created what became the Financial Action Task Force. That was the 1980s and they were concerned about the spread of illegal drugs, the harm they were causing, and the fact that more countries were producing them, and wanted to stop drug dealers being able to keep their profits. Among other things they committed — in the words of the 1989 communiqué — “to prevent the utilization of the banking system and financial institutions,” which is part of the clause that gave birth to the entire global anti-money-laundering system. Well, 37 years have passed, so let’s check in on how that’s going. 

This year the G7 communiqué expressed concern about the spread of illegal drugs, about the harm they’re causing, and about the fact that more countries are producing them. “We emphasize the continued need to strengthen the global anti-money laundering architecture to prevent financial crime and improve enforcement and asset recovery outcomes, in line with the Financial Action Task Force standards,” this year’s summit document states. 

Plus ça change. Maybe in another 37 years, they’ll look up and wonder whether they should try something else, and indeed whether the FATF standards aren’t ripe for reconsideration.

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The post How governments enable kleptocrats by doing nothing appeared first on Coda Story.

I’ve been writing this newsletter since 2020, and in my first edition I marvelled at the concept of the centi-billionaire, and the fact there were at the time three people with 11 zeros in their net worth. What a six years it’s been. When I started writing this week’s edition, Elon Musk was a mere David Sun away from becoming the world’s first trillionaire, and now as I’m finishing it, Musk is worth the scarcely conceivable sum of $1.1 trillion. Nothing like this has ever happened before and there is no sign it is going to stop happening. There is no reason at all to suppose that in another half-decade I won’t be writing about how deci-trillionaires are the new thing.

This increasingly extreme inequality is a challenge for social cohesion, democracy and civilisation that we haven’t seen in modern times, second only to climate change as a threat to our future. Although in some ways, they’re the same challenge, considering the disproportionate share of emissions coming from rich people.

In some ways, if Musk’s wealth seemed to be making him happy it wouldn’t be so bad, but it appears only to make him angrier. I like to think that if I had a trillion dollars, I’d do something more constructive than stir up protests against ethnic minorities.

Reducing inequality is the right thing to do for every reason, not least because it would deprive very rich people of the ability to stoke pogroms anywhere they like. But how to do that? The only thing that has previously reduced inequality to any significant extent has been the 20th century’s series of global conflicts with massive destruction of life and property, and that’s the kind of thing it would be good to avoid.

I think there is a strong argument to be made, however, that the financial trickery abused by the very rich is also bad for national security, and it’s one nicely made here by Matthew McGlynn, who specialises in researching Russia. By degrading the ability of oligarchs to cheat their way to riches, we’d also limit the space of billionaires to dodge taxes and accountability.

It is notable that expert after expert speaking to the House of Representatives Committee on Financial Services about Chinese Money Laundering Networks pleaded for the Corporate Transparency Act to be properly implemented. “When a laundering network operates by scattering its footprint across hundreds of student accounts, dozens of shell companies, and multiple jurisdictions, traditional compliance frameworks may treat flags as isolated, minor incidents. The systemic risk is consistently underestimated, and responses remain heavily reactive,” noted Louis DeTitto.

If first we come for the money launderers, then the billionaires won’t speak out because they’re not money launderers. Also, it would mean we’d do a better job of tackling money laundering, which would be nice. 

While on the subject of congressional hearings, there are interesting moves by Senator Richard Blumenthal to probe how Iranian and Russian sanction-dodgers are using cryptocurrencies. In April, he wrote to Binance requesting further information, and now he’s written to Tether asking for information about misuse of its USDT stablecoin.

The details he’s requesting are far-reaching and potentially highly consequential, since they relate to connections with Iran and Russia, including A7, issuer of the leading ruble-denominated cryptocurrency. Perhaps most important, however, is his first question: “What legal jurisdictions does Tether believe it is subject to for USDT, in particular for anti-money laundering rules, reporting obligations, asset seizures, and sanctions compliance? Does Tether believe it is legally required to comply with Department of Treasury sanctions for USDT and issue suspicious activity reports (SARs) to the U.S. government?”

If the U.S. asserts regulatory authority over dollar-denominated cryptocurrencies as it has over all transactions in dollars then that would significantly undermine their attractiveness to illicit actors, and also do a lot to reassure people like me. Tether, meanwhile, has been bigging up its cooperation with law enforcement agencies, and says it’s frozen $450 million globally.

“For the past few years, stablecoins have come to dominate the landscape of illicit transactions, and now account for 84 percent of all illicit transaction volume,” concluded Chainalysis in 2026’s crypto crime report. It estimated total illicit transactions at $154 billion last year, so the stablecoin share of that was almost $130 billion. That is a fraction of the amount of money laundering estimated to move through either the trade system or indeed the formal financial network, but still a lot of money. It’s interesting to see, however, how Chainalysis still holds out hope for well-regulated cryptocurrencies helping to solve problems caused by standard finance.

“Stablecoins and on-chain settlement mechanisms in particular offer low-cost, borderless avenues for remittances, payments, and savings,” Chainalysis said. “If coupled with sound regulation and inclusive policy frameworks, these tools could help governments leverage crypto not just for resilience, but also for broader financial inclusion as part of economic recovery.”

Seeing will be believing.

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The post Trillionaires are a national security risk appeared first on Coda Story.

It has become a theme of this newsletter to lay out what is needed to tackle financial crime, and then to point out how the U.S. government is doing the opposite, and I assure you that I am as bored of it as you are. I try therefore to avoid writing about Donald Trump any more than I have to, but I’m afraid I very much do have to address the subject of the $250 bill.

Criminals adore banknotes, thanks to their anonymity and convenience, and that love has only grown as the financial system has become more regulated. They love high-denomination banknotes most of all, because they let criminals move a lot of value in the smallest possible space. 

This is why the proportion of $100 bills among the banknotes printed by the Federal Reserve increases year after year. Two decades ago, $100 bills made up 64.4% of the value of outstanding dollar banknotes; at the end of 2025, it was 81.8%. And the total number of notes has increased massively: 5.4 billion in late 2005; 19.9 billion last December.

If I could click my fingers and make one thing happen to stop money laundering, it would be to stop central banks printing large denomination banknotes (as has happened in the past in Singapore, and in the Eurozone). The Federal Reserve is not the only offender — the European Central Bank still has €200 bills, the Swiss have 1000 franc notes, the Brits have £50 notes – but the $100 is by far the most widespread of these big bills and thus the most egregious example. There are almost four times more of them in circulation than all the big euro-denominated bills added together.

So what is the White House doing about the problem of large denomination bank notes? “Trump administration officials have pressed the office responsible for printing the nation’s money to design a $250 bill featuring the president’s portrait,” reports the Washington Post. Treasury Secretary Scott Bessent said he didn’t think that there was anything “untoward” about having the current president of the United States on the 250th anniversary bill.

Look, I like the word “semiquincentennial” as much as anyone else who has had to squint at it for a while to work out what it means. And I appreciate that Americans are rightly proud of how long their republic lasted before beginning to turn into a monarchy, but it would be nice if someone in power at least acknowledged how grotesque it is to float the idea of printing a banknote that’s even more useful to criminals than the existing ones.

Sanctions need enforcement

There is better news from the United Kingdom, where the government has expanded its sanctions against crypto firms helping Russia finance its war in Ukraine, with a raft of new designations, including against HTX (previously known as Huobi), one of the largest exchanges in the world and one that is linked to billionaire Justin Sun, who has promised full compliance with the sanctions.

What is interesting about this is that the UK is getting ahead of the United States, with which it has historically cooperated closely when issuing sanctions. “Anyone that's been in this space for a minute knows what a disaster Huobi is,” wrote crypto-watcher Richard Sanders on linkedin. “Quite frankly, the UK took an action the U.S. should have a long time ago. The UK realized the U.S. isn't going to do this under the current administration. The UK, justly, got sick of waiting for this industry to do the right thing, as much as they got sick of waiting on other countries.”

That said, sanctions create a lot of compliance for law-abiding firms and individuals keen to avoid evading them. And the chances that law-breakers will be caught if they decide to engage with HTX regardless? Well, not very high, judging by a new report into the UK’s lead agency for serious and organised criminality.

“The National Crime Agency (NCA)’s IT infrastructure isn’t fit for purpose. This systemic weakness affects the entire agency,” the report says. “‘When I started in policing 15 to 20 years ago, I had better technology than I do in the NCA’,” one officer is quoted as saying.

So, how can officers trace online criminality if even their own systems don’t work? Not very well, not least since the government, in its futile attempts to stave off the political challenge from the far right, has assigned much of the agency’s workforce to tackling immigration (incredibly, even officers focussing on child sexual exploitation have been moved). “Some interviewees told us their teams were operating at 50 percent below previous levels. One interviewee told us that the effect of this was that they were ‘receiving more work with less resource’,” the report says.

So, once more, we are back to the old anti-money laundering model of more expensive compliance for the good guys, and no consequences for the baddies, since there is no one to investigate them. Sanctions are no substitution for police work, and one day someone will realise that. They work for a bit — see the graph of trades in the Russian cryptocurrency A7A5 for an example on Justin Sun’s Tron blockchain — but then someone works out a way around them, and everything carries on as before, because none of the people committing the crimes have been affected.

“The government has consistently failed to provide proper investment that would allow the NCA to provide an effective enforcement response to the range of serious threats the UK faces,” said Susan Hawley, head of Spotlight on Corruption.

But corrupt politicians and enforcement agencies can be exposed. So congratulations to the excellent folks at the French anti-corruption group Sherpa who have secured another victory in their delightfully successful campaign against the corrupt financial ties between Paris and the rulers of its former colonies in Africa. All the way back in 2007, Sherpa started its battle with French authorities that were refusing to investigate the wealth of their political allies. Thanks to its persistence, cases were brought against multiple politicians, most notably from Equatorial Guinea, and now the niece of Denis Sassou-Nguesso, president of the Republic of Congo. She will appeal, so this is not over, but it is further proof of how effective hard-working advocacy organisations can be.

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

The post Donald Trump’s $250 gift to launderers and criminals appeared first on Coda Story.

A top banker has got in trouble by referring to employees whose jobs will be replaced by AI as “lower-value human capital.” But he’s just saying the quiet part out loud: compliance officers have been expected to work like inefficient computers for years already anyway. Standard Chartered CEO Bill Withers used the unfortunate phrase when describing how the bank plans to keep hitting its profitability targets by cutting 15% of back office staff, and has tried to backtrack a little after a predictable storm of criticism, including from the former president of Singapore. 

It would be nice to think of bank employees deployed to fight financial crime as super-effective old-school gumshoes, with a bottle of bourbon in the bottom drawer and an inexhaustible stock of one-liners, but in reality their jobs are more like something from ‘The Office’ than ‘The Big Sleep’.

Thousands of people sit in cubicles in Warsaw or Bengaluru, checking through transactions flagged as possibly abnormal by banks’ automated systems, and confirming that 99% of them are, in fact, normal. Anything that might conceivably be abnormal gets sent up the chain, where someone more senior will almost certainly decide it wasn’t. 

It is a ruinously expensive process and, as far as we can tell, completely ineffective. The best estimates we have for the size of the criminal economy suggest it has grown, untroubled, along with everything else for decades despite all the laws, fines, and prosecutions that we’ve thrown at the problem. 

But banks’ financial crime compliance isn’t about stopping financial crime at all: it’s about stopping banks from being fined, as Standard Chartered has previously been, enormous sums in both the U.S. and the UK. As long as banks can be sure that AI checks boxes in ways that satisfy regulators, then they’ll be happy.

This is a little bit worrying because AI is already getting very good at fraud. I am very alert to attempts to trick me but was sufficiently fooled by an AI email yesterday to forward it on to someone. Fortunately, a very similar one arrived (purportedly from someone else) a few minutes later, alerting me to my mistake. Money laundering is a laborious activity and criminal gangs will be as keen as banks to cut their back office expenditure, and AI could help automate the processing of the many small transactions that add up to a large amount of money. Phishing and smurfing are just a couple of its use cases, however.

“Scammers can leverage AI to scrape data from social media and dating platforms to identify vulnerable targets (e.g. lonely individuals, recent retirees, or people interested in finance) for pig butchering scams,” notes TRM Labs. “Bots can sustain long-term, emotionally persuasive conversations without tiring or making mistakes, making the scam more scalable.”

And that’s before you get onto AI’s ability to exploit cryptocurrencies and smart contracts to really start rampaging through the crypto world. “TRM observed a roughly 500% increase in AI-enabled scam activity over the past year. The convergence of generative AI, programmable financial infrastructure, and global crypto liquidity has altered the economics, velocity, and scalability of fraud,” the blockchain analytics firm said in a follow-up report. This is very bad indeed.

So, although I can see why people are annoyed that Withers referred to his bank’s employees in such a disparaging way, I am more troubled that he’s planning to replace them with AI, rather than to retain them and train them in how to counter it.

It was remarkable, however, to see Warren Davidson, chair of the illicit finance subcommittee at the House of Representatives Financial Services Committee, draw precisely the wrong conclusion from all this. Although he was correct in condemning the defensive nature of compliance, and its focus on generating paperwork over results, he then got lost in praising the White House’s decisions to attack corporate transparency legislation.

"As we focus on risk, we must also ensure that tools like artificial intelligence are fully deployed to counter the AI-enabled crimes of today,” he said, without realising that, without reliable information to train the AI models on, this is as useless an approach as the one he says has failed. If you don’t know who owns what, neither will a computer, no matter how cleverly it can pretend to be human.

I sincerely hope he listened to the testimony of Carole House of the Atlantic Council who forcefully pointed out the harm to national security and to ordinary Americans caused by the United States’ failure to create even an approximation of a decent corporate registry, as well as the historic idiocy of its current crypto policy. “Without a secure identity foundation, AI agents will simply scale up fraud at a speed and volume that human investigators can't possibly track, destroying trust in the whole system,” she said in testimony that I highly recommend you take a look at.

I very much doubt Davidson was listening, however, because that is not the direction the Republican Party is going in right now. I would write more about that, but frankly it’s all too depressing, and I’d rather move on.

So let me point you towards this excellent paper on how online scam marketplaces work, with criminals using the messaging app Telegram and the stablecoin Tether to launder hundreds of billions of dollars. It argues that our current approach of sanctioning exchanges is futile since their owners just shut them down and switch to a new platform that works in the same way but hasn’t yet been sanctioned.

“As long as the underlying digital infrastructure remains permissive, criminal syndicates will simply migrate to new channels. To move from reactive disruption to systemic prevention, the international community must shift its focus toward the structural enablers of these marketplaces,” Elliptic’s Tom Robinson argues. Elliptic is unusual among blockchain analytics companies in being willing to name Tether as a major vector for money launderers. Its rivals tend to just say “stablecoins,” I have no idea why.

Meanwhile, there is something grimly depressing about the fact that — against the backdrop of, well, everything — the UK has postponed June’s illicit finance summit due to “scheduling issues in the international calendar.” Everyone is so busy dealing with the consequences of illicit finance, that no one has time to talk about illicit finance.

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The post AI is not the answer to AI-enabled fraud appeared first on Coda Story.

The United States is inching closer to passing a gigantic piece of legislation to put cryptocurrencies on a secure footing, with the bill emerging unscathed from the Senate’s banking committee. Opinions differ as to what this means: crypto people are thrilled, while anyone who knows about money laundering is terrified. Passage of the so-called CLARITY bill has been a key goal of crypto enthusiasts since Donald Trump came to power, since it would give them the legal certainty to engage in “financial innovation” without worrying about a return to the Biden-era policy of trying to regulate them as if they were normal people.

Committee chairman Tim Scott is delighted: “For me, this is personal. My mother raised my brother and me with faith, grit, and determination, and she taught me that the American Dream should be within reach for every family, including single mothers working hard to build a better life for their children.”

I quote Scott partly because it’s such a weird justification for passing crypto regulation (or perhaps he just says that sort of thing about literally everything he ever does?), but mainly because it’s pretty clear that the bill as it stands will be a disaster for the kind of vulnerable people he claims to be fighting for.

In a sign of experts’ concerns, Transparency International’s U.S. office put out a statement quoting nearly all the most respected voices on money laundering in America arguing that the bill needs better safeguards against dirty money. “At a time when we know that hostile actors like (Iran’s Revolutionary Guards) are looking to circumvent U.S. sanctions to rearm and threaten Americans and U.S. interests around the world, it is inconceivable to me that we would open new, effective channels for sanctions evasion,” said Richard Nephew, former U.S. Coordinator on Global Anti-Corruption and Deputy Special Envoy for Iran.

“Terrorists, violent drug traffickers, and organized criminals who prey upon the elderly and unlearned in increasingly sophisticated financial and AI generated schemes are, quite literally, getting away with murder, funded by untraceable cryptocurrency transactions hidden behind an anonymous block chain,” said former FBI agent Karen Greenaway.

There is an awful lot of money in crypto, and Tether alone now has three people among the richest 100 in the world. Tether’s largest single shareholder Giancarlo Devasini’s wealth has grown from $9.2 billion in 2024 to $89.3 billion now, while chief executive Paolo Ardoino and former CEO Jean-Louis van der Velde have done pretty well too. Though none of them have done quite as well as Changpeng “Binance” Zhao, crypto’s only centibillionaire (so far).

In the UK, there’s a lot of concern about the millions of pounds going from crypto investors to Reform’s Nigel Farage, who has become a crypto champion, no doubt coincidentally. But, wow, look at what’s happening in Alabama for a sign of what the future looks like if crypto people really get their hands on the purse strings and try to buy their way into the Senate. 

That much money doesn’t just help supporters win, it also terrifies opponents: standing up to the crypto lobby guarantees you’ll be swamped in hostile advertising. How do you want to be paid, as Pablo Escobar used to say, in silver or lead? 

But why should the rest of the world care that this is happening? I’m sure I’m not the only foreigner who’s been staring in bewilderment at the growth of U.S. prediction markets, and how efficiently they allow insiders to monetise their privileged access to inside information. A lot of those markets are barred in other countries, but the U.S. soldier who was arrested for betting on the Maduro capture was trading on polymarket, a crypto-denominated market which is blocked in the United States too, despite Donald Trump Jr. being an investor.

Such restrictions can be easily bypassed by using a Virtual Private Network, so U.S. regulators are using artificial intelligence to track down insider trading on polymarket. After that soldier’s arrest, I suspect Americans will be much more careful about what they do.

Prediction markets claim they don’t want insiders trading on privileged information. But if the markets are to function in a way that supports their founders’ justification for them, as a price signal for future events, they rely on people with knowledge to be using them to make bets and thus to move prices in a useful direction. So clearly the temptation will always be there for anyone with inside information to use it to make some easy money.

And does anyone think U.S. regulators will care about Indians, Brits, South Africans Ukrainians, or other foreigners using crypto to trade on information from their own countries? They after all have a track record of treating foreigners and U.S. citizens differently. That’s why it was Francesca Albanese, with her American husband and daughter, who managed to have sanctions cancelled for daring to investigate Israel’s behaviour in Gaza, whereas non-U.S. connected people have failed to do so.

The new U.S. crypto bill coupled with U.S.-based crypto-denominated prediction markets points towards the United States becoming a gigantic offshore enabler of corruption for the rest of the world; a digital version of what Switzerland was in the analogue years, with everyone else reduced to begging its regulators for assistance. 

“Crypto prediction markets are accessible to anyone with an internet connection and a wallet, pooling liquidity from a global user base rather than a regional one,” says Chainalysis. I think they mean that to be a good thing, because the blockchain is transparent and malefactors can be spotted easily yada yada, but it sounds beyond dystopian to me. I’m genuinely a bit terrified of what this will mean for corruption in the next few years, and I haven’t heard of any politicians who are alert to it yet.

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

The post Crypto’s corrupt American dream appeared first on Coda Story.

While much of the media industry focused on the churn of headlines, we became increasingly interested in the undercurrents beneath them: the hidden systems, infrastructures and ideologies shaping events across borders and over time.

Again and again, our reporting led us back to the same realization: for a long time, the struggle over information was understood primarily as a question of censorship or access. Who controls information? Who gets to publish? Who gets silenced?

Those questions still matter. But they no longer fully describe the world we live in.

Today, the struggle over information is about who builds the systems through which reality is organized, distributed and trusted. From state propaganda to algorithmic feeds, from platform monopolies to AI-generated noise, the battle is not over facts. It is over the infrastructures that determine which narratives spread, which voices are amplified and which communities remain connected.

Over the past year, these questions led to a collaboration between Coda and The Continent, the pan-African newspaper founded in Johannesburg by Simon Allison and Sipho Kings. Although our reporting emerges from very different histories and geographies, we found ourselves arriving at remarkably similar conclusions about power, fragmentation and the future of journalism in an age of informational instability.

This two-chapter essay is the beginning of that collaboration, and marks the start of a new project called The Atlas. Pilot edition is available here — please feel free to share with friends, family and colleagues, preferably in its entirety.

In Chapter One, I return to the world of my Soviet childhood: propaganda, samizdat and the search for trustworthy signals through noise.

In Chapter Two, The Continent co-founder Simon Allison presents the Parable of Sinn Sisamouth: the story of how some of the greatest songs ever written were nearly lost, and then found, and then lost again. 

Taken together, these essays ask what journalism becomes in a world where information is no longer organized primarily to inform, but to capture attention, manufacture reaction and shape perception at planetary scale.

The Atlas grows out of that question.

Chapter One: Through the Static

Whenever I am asked why I decided to become a journalist, an image from my childhood pops into my head. It’s dusk. I am 10, sitting in the kitchen with my mom. She is glued to a shortwave radio. Outside, the Soviet Union is on the cusp of collapse. Georgia, where we are, is on the brink of civil war. We didn’t use the term back then, but fake news was all we got through official channels. Real news — coming from the West — felt like a lifeline. I was in awe of the crackling radio that held my mother’s full attention. I wanted to become that voice.

Years later, I got my dream job at the BBC and spent much of my adult life moving between wars, uprisings and authoritarian states. Again and again, I found myself in places where truth was contested terrain: Baghdad, Damascus, Donetsk, Sana’a. But over time I realized something fundamental had changed. Modern authoritarianism no longer relied primarily on suppressing information. It had discovered something more effective.

Information could simply be drowned out by static.

That realization became stark for me in eastern Ukraine in the summer of 2014. I arrived in a field of bright yellow sunflowers where the bodies from Flight MH17 still lay scattered across the ground. A Russian missile had blown the passenger plane out of the sky, killing all 298 people on board. Yet almost immediately, the Kremlin flooded the information space with competing explanations. It was a Ukrainian fighter jet. A failed assassination attempt on Putin. The plane had been filled with corpses before takeoff. Each theory contradicted the next, but that hardly mattered. The point was not to persuade, it was to exhaust. It was to create so much noise that truth itself began to feel unstable.

Over the following years, I watched versions of the same logic spread far beyond Russia. Social platforms transformed public conversation into a permanent stream of outrage, performance and distraction, collapsing vastly different kinds of information into the same endless feed. War footage, propaganda, conspiracy theories, journalism and gossip all began competing inside systems designed not to inform people but to capture and hold attention.

Noise became the new censorship.

And increasingly, I found myself thinking about the world of my childhood again. Not because history was repeating itself neatly, but because the emotional landscape felt strangely familiar: confusion, exhaustion, distrust, the constant sense that reality itself was becoming slippery. Back then, people searched desperately for clear signals through the static of Soviet propaganda. Today, we are drowning in a different kind of static, but the instinct, the search for clarity feels remarkably similar.

In the Soviet Union, people developed ways of navigating that confusion. Among my strongest memories from that time is the sound of my parents’ typewriter late at night. Friends would pass around copies of banned Soviet literature and my parents would sit at the kitchen table all night, retyping them page by page so they could be shared again. It was my first encounter with samizdat, although I didn’t know the word then.

Looking back now, what strikes me is that samizdat was never simply about forbidden texts. It was about building trusted alternative systems of circulation when official systems had lost credibility.

At Coda, we have spent years building journalism against the logic of noise. We slowed stories down. We followed themes instead of headlines. We built a reporting system designed to connect events across borders and over time, helping readers see patterns instead of fragments. But as our globally distributed newsroom adapted to an increasingly fractured information landscape, it became clear that journalism alone was not enough. Distribution shapes understanding as much as reporting does.

Around the same time, in Johannesburg, Simon Allison, Sipho Kings and their team were building something that challenged many of the assumptions dominating digital media. The Continent, their pan-African newspaper, spreads largely through direct sharing networks: passed from reader to reader rather than pushed by algorithms.

Different histories had brought us to remarkably similar questions. What does journalism look like when trust is collapsing, attention is fragmented and the systems that carry information have themselves become instruments of power?

Out of that convergence came The Atlas: a new publication that brings together Coda’s methodology of following systems across borders and over time with The Continent’s radically distributed model for reaching readers beyond algorithmic feeds.

The Atlas is built on a shared conviction: as fragmentation, distrust and informational overload spread across the world, some of the clearest ways through will come from places that have already spent decades navigating propaganda, instability and contested reality. Places once treated as peripheral are becoming essential to understanding the defining question of this age: how can meaning survive systems designed to overwhelm it.

Chapter Two: The second silencing of Sinn Sisamouth

Imagine if your favourite song disappeared, forever. 

Almost every album I have ever loved was recommended to me by my friend An-Rui. A few months ago, he sent me a track by the undisputed King of Khmer Music, the Golden Voice, the Cambodian Elvis himself – Sinn Sisamouth.

I had never heard of him.

I didn’t respond at first, so he nudged me. That night, after the kids were asleep, I put on my headphones, sat in the garden and immediately lost myself in Cambodia’s psychedelic rock scene of the 1960s and ‘70s. I don’t know enough about music to explain exactly what I fell in love with, but within weeks I was, according to Spotify, among the top one percent of Sinn Sisamouth listeners worldwide.

An-Rui had added a note to his recommendation. “the songs are happy but since i know what his fate was and i don’t understand the words, it sounds incredibly sad to me”.

The story goes something like this: A small-town boy with an extraordinary voice moves to the big city, and conquers all before him. He writes hundreds of songs, bridging Khmer musical traditions with new western influences: jazz, rock & roll, bossa nova, blues, the Beatles, and, of course, Elvis Presley. He toured the country. He toured the world. He made music with an actual King, Norodom Sihanouk, and became Cambodia’s most beloved rockstar.

Then, in 1975, the Khmer Rouge seized power. In the course of committing a genocide, the communist regime disappeared Sinn Sisamouth, and banned his music. He has never been seen, or heard from, again.

But his music never died. It lived on brittle records, hidden for generations under floorboards. It lived on scratchy cassettes, passed hand to hand among the diaspora.

It was only decades later that his music was digitised and remastered, and made available on streaming platforms to the likes of me.

When I listen to Sinn Sisamouth, I can’t help but think about how easily we could have lost his masterpieces entirely. And I wonder what else might have been lost that we have not been able to recover.

And then it happened again.

There’s a particular track that I like to play in my car, where I can turn the bass up as high as it goes. I was driving one afternoon and looked for it on Spotify. It was gone, even though the rest of the album was there. 

I looked again on my laptop at home. Nothing. Gone from Spotify. Gone from Apple Music. Gone from YouTube. Like it had never been there in the first place. I started to wonder if I had gone crazy, and maybe imagined the song entirely. And then I started to panic: What if I never heard it again?

Eventually, I found a bootleg YouTube version, using a different transliteration of the Khmer title – Kanlang Pnheu Pran, instead of Konlong Phner Bran. Before I tracked that down, I had to wade through dozens of AI-generated Sinn Sisamouth ‘cover versions’, all uploaded to YouTube within the last few months. If I had never heard it before, I would never have been able to tell which was the original.

It’s not unusual for songs to disappear from the Internet, especially when the music is from non-English-speaking countries. I’ve had similar experiences with the music of Sharhabil Ahmed, the Sudanese jazz legend, and Ethiopia’s Tilahun “The Voice” Gessesse.

In fact, it’s not unusual for other kinds of information to disappear from the internet; to be edited after the fact; or to be simply lost among all the digital noise. Digital information is incredibly precarious, and becoming more so by the day. AI slop is taking over social media platforms. Algorithms determine what information we can and can’t see, shaping our cultural and political preferences. And powerful interests are becoming increasingly bold when it comes to brazenly manipulating information in their favour – or, of even greater concern, restricting the flow of information across borders.

Amazon changes the contents of books on people’s Kindles without telling anyone. News websites quietly alter critical stories, post-publication, to remove evidence of wrongdoing (my favourite example: the Financial Express published a story critical of India’s richest family; only to replace it with a glorified press release a few days later. They neglected to amend the URL, however, which contains the original headline). Governments shut down internet access on a whim, or legislate which apps and websites are available to specific populations.

For journalism, this is an existential threat. Our job is not just to hold power to account – it is also to write the first draft of history. But if we can’t preserve that first draft, or distribute it effectively, then what, exactly, is the point?

The Continent and Coda Story are working together to try something different. We want to publish news about the world, produced and verified by humans, that cannot be edited after the fact; and to distribute it in a way that dramatically decreases our reliance on unaccountable algorithms or search engine optimisation. The Atlas — pilot edition available here — is our answer to the precarity of information online. It’s a work in progress.

Stay tuned: if we’re going to succeed, we’ll need your help. And if we do succeed, the secret of our success will be those very same transnational networks that kept the music of Sinn Sisamouth alive. Communities of like-minded people, of friends and families will always find a way to stay connected, no matter how vast the distances between them, or how great the obstacles. So what does a global newspaper look like if we design it with exactly these communities in mind?

As soon as I found that bootleg on YouTube, I ripped an MP3 copy and sent it to An-Rui on Signal. “KEEP THIS SAFE,” I told him. I don’t know what happened to the song on Spotify, or if it is ever coming back. But I can’t take the risk of never hearing that bassline again. And here it is, in case you want to hear it too.

The post The new samizdat appeared first on Coda Story.

Nigel Farage, the leader of the UK’s right-wing Reform UK party, has taken millions of pounds from crypto people, including one convicted of financial crimes in the United States. There are, despite Farage’s insistence to the contrary, questions around whether he followed the rules. Nonetheless, his party has swept local elections. There’s a lesson here for progressive parties everywhere, including in the United States where senators are seeking documents relating to financial ties between the commerce secretary and Tether. What if you get your ‘gotcha’ moment, turn around to the voters with a broad smile… and they vote for your opponents anyway?

Believers in democracy need to start advocating for more transparency, more enforcement and more restrictions on murky finance if they want to stop unaccountable money from buying influence in their countries. It is not enough to rely on journalists and activists to produce the occasional investigation, and expect voters to do the rest: we need properly-resourced agencies that can keep dirty money out of our systems if we want them to remain clean. If history tells us anything, it’s that criminals get elected all too often.

This is urgent. Tether made more than $1 billion in profits this year, in the first quarter, and is thinking hard about the midterms and how candidates might be encouraged to fight for crypto. And that’s just one company. Progressives who believe in fairer finance, a state’s right to regulate its own economy and the power to oversee who’s buying whom, don’t have that kind of money to spend to influence elections, so they need to start making the argument for campaign finance restrictions much more forcefully.

But there’s another point here too. I am working on an article about money laundering at the moment, and was chatting to two UK detectives last week. They led a successful operation in their city (I’ll post the article when it’s done) and I asked if they thought it had made a lasting difference. “With all crime, you take one out and there is another,” one of the detectives told me. “I'd like to think it has made a dent but there will always be more.”

In the case they worked on, gangs were bringing cash generated via the cocaine trade to be laundered into crypto (no prizes for guessing which cryptocurrency they preferred). The detectives identified £53 million in turnover over two years. It’s great that they jailed the ringleaders, but you can see why they’re not getting too carried away. That total is about a quarter of a percent of the UK cocaine market’s turnover, so the gangs really won’t have noticed the loss. And, for the police, it was five years’ work.

To a fairly large extent, since the first U.S. operation in Miami in 1980, when we’ve spoken about fighting dirty money, we have really been talking about stopping cocaine gangs by taking away their ability to make a profit. And, despite occasional successes like the one I’m writing about, this approach has overall been a catastrophic failure. Cocaine is cheaper, more abundant, and more widespread than ever before.

This is important for many reasons, obviously because entrusting the supply of a dangerous substance to criminals is bad, but also because the existence of a vast underground financial system to move the cocaine trade’s profits creates a mechanism through which Russian spies, terrorists and others can hide their cash too. For me though, the real problem is that we have an urgent threat to democracy posed by hidden unaccountable money. Instead of tackling that problem though, our police officers are fighting an endless war against drugs that was lost decades ago.

My modest proposal therefore is to legalise cocaine. It’s available everywhere already, so there’s no downside. We should tax it, regulate it, make sure kids can’t buy it and, as a useful side effect, take all the liquidity out of the underground economy. Our police officers could then stop running to go backwards, and instead fight a battle they might actually win, which is to stop fascists and kleptocrats from buying our democracies.

Use oligarchs to undermine Putin

Here’s a good article from The Economist by “a former senior official in the Russian Government,” arguing that Vladimir Putin is losing his grip. Now, I’m always a little cautious about articles that tell me what I want to hear, as well as the veracity of information and analysis provided by Russian officials, former or current, but it does make some very interesting points.

Of particular interest to me is the idea that Russia’s elite is annoyed with Putin because its members are worried about having their assets stolen, with $60 billion worth of property nationalised or seized by corrupt officials in the last three years. 

“Previously their property rights were outsourced to the West. They used London courts, offshore structures and international arbitration to resolve conflicts or seek protection. Now conflicts must be resolved domestically, without functioning institutions. Demand for rules grows more urgent as redistribution of assets gathers pace,” the article states.

One of the reasons why democracy failed in Russia is because the oligarchs were able to keep their wealth offshore, and thus to essentially colonise their own country, secure in the knowledge they were themselves immune from the unfairness. It would be a pleasing irony if the horrific war in Ukraine ended up undermining not just Putin, but Putinism as a whole.

There is a huge opportunity here for Western governments to capitalise on the dissent, and to start quietly offering sanctions relief to Russians willing to break with Putin, and who’re prepared to surrender a decent chunk of their wealth to help Ukraine in return for being able to keep the rest. There aren’t enough police officers to actually bring the cases needed to investigate, prosecute and confiscate the oligarchs’ wealth anyway (see item above), so we may as well start negotiating and see what they’re willing to do to get it back. In short, this is a big week for me making unfashionable policy proposals.

AI-generated launderers

There’s debate in the United States about getting rid of the Corporate Transparency Act, with Jeff Bezos’ Washington Post supporting repeal, even though the law has never actually been implemented. Opaque shell companies are a weird outgrowth of capitalism that corporations’ original inventors — who wanted to create insurance for entrepreneurs, not getaway vehicles for crooks — never intended to happen, so it’s very odd that they’re now being presented as some kind of human right.

If you want a reason why the appallingly lax American system should be cleaned up, here’s a post on X about someone who tasked two AI agents with making money, and came back to find out they’d registered a Wyoming LLC all by themselves. This suggests the opening of a whole new frontier of automated money laundering, and the consequences are frankly pretty terrifying. The Corporate Transparency Act should be strengthened, not abolished.

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

The post Legalize Cocaine to save democracy appeared first on Coda Story.

On April 24, Brazil’s competition authority, the Administrative Council for Economic Defense (CADE) announced it was opening an investigation to assess whether Google’s use of news content amounted to unfair competition practices against the Brazilian press. The announcement was welcomed by civil society organizations that have tried to push regulation to limit the reckless power of Big Tech for years. Ajor, Brazil’s Digital News Association, said that “a balanced relationship between digital platforms and journalism organizations is fundamental to the flourishing of journalism committed to the public interest. By ensuring a fair competitive environment, Cade directly advances that goal.”

In spirit and intent, CADE’s investigation into Google is similar to legislation in Australia that recognized that value is being extracted from news publishers without proportionate recompense. In Brazil, the case has been debated since 2019, but the adoption of AI Overviews helped alter the perspective of Brazilian judges. The overviews are artificially generated summaries that synthesize information from several sources and appear at the top of Google Search results. They “raise potentially more concerns,” ruled Judge Camila Cabral Pires Alves, “as they may more profoundly alter the economic function of the interface and expand the ability to retain attention within the platform's own environment.”

CADE will now investigate whether Google should be sanctioned for “alleged abusive exploitation of a dominant position, in light of the technological evolution of the conduct.” While there is perhaps a greater global appetite to regulate the impacts of AI – even the Trump administration has recently acknowledged that some oversight may be necessary – the CADE judges have been under considerable pressure from Big Tech executives to stop investigations into how their control of the market harms Brazilian businesses. 

For those of us who have reported on Big Tech, this aggressive lobbying is not surprising. Companies like Google, Meta, Twitter, TikTok, Amazon, and Microsoft have long attempted to interfere in any decision or legislation that can harm their interests in Latin America. According to a joint investigation by journalists across 13 countries, Big Tech lobbyists got away with convincing legislators in Colombia to weaken a rule meant to protect children’s mental health and prevent enforcement of privacy regulations in Ecuador. It took a team of over 40 journalists from 13 countries to uncover this while reporting on the ‘Big Tech Lobby’ in the continent and across the world.   

Threats by the U.S. government to retaliate against any country or international entity that sought to regulate Big Tech added another layer to an already complicated and uneven relationship with Silicon Valley. “Digital Taxes, Digital Services Legislation, and Digital Markets Regulations are all designed to harm, or discriminate against, American Technology,” wrote Donald Trump on social media. “Show respect to America and our amazing Tech Companies or consider the consequences!” During the past year, Trump’s envoys have forced dozens of governments around the world to dilute or even shelve regulation in exchange for lifting tariffs. 

In “Big Tech’s Invisible Hands,” which I coordinated alongside Maria Teresa Ronderos, from CLIP (Centro Latinoamericano de Investigación Periodistica), journalists mapped a total of 75 executives that were part of “public policy” or “government relations” teams in Brazil. Tech companies utilized a “revolving door” in which public sector employees could go straight into highly paid jobs leveraging their contacts and influence. Doors opened more easily. Invitations to hangouts and events were more likely to be accepted. 

Lobbying in Brazil is dialed up to eleven. The country has 163 million internet users, with over 150 million on WhatsApp, and over 120 million on YouTube, Instagram and Facebook. With AI, Brazil is a similarly large, influential market. Portuguese is the sixth most widely-spoken language in the world, with 70% of speakers based in Brazil. Which means that, if an LLM has been trained in this language, it probably used content created by millions of Brazilians going about their business of making friends, debating politics and football online. It’s not just about journalists; we are all unpaid labor for Big Tech. 

In the words of Arthur Lira, the Speaker in Brazil’s Congress who filed a criminal complaint against Big Tech executives in 2023, companies adopted a variety of tactics “to shut down democratic debate and intimidate lawmakers” and defeat any attempt at using legislation to force accountability. Google, he said, used its search homepage, used by over 85% of Brazilians, to spread fear that proposed laws would “make the internet worse” or “make it harder to know what is true or false on the internet.” A report by the Federal University of Rio de Janeiro found that Google invested in ads on its own platform so extensively that it tweaked the search, prominently featuring the word “censorship” in connection to the Brazilian bill. Google also hired Michael Temer, a lawyer and former President of Brazil, to influence lawmakers and Supreme Court Justices. Of course, it was not Google alone. Meta executives, for instance, even argued that proposed legislation in Brazil could lead to the Bible being censored.

But Brazilian lawmakers, the Supreme Court, and civil society have persisted. On August 28, 2025, the “Felca Law” was approved, after a video by the influencer Felca denounced the exploitation and exposure of children on social media. The law establishes that digital platforms must take measures like verifying user age, implementing parental controls, and preventing children's exposure to adult content, gambling, and pornography. They must create reporting channels and may face fines of up to 10% of their annual revenue in Brazil.

Brazil’s president Luiz Inácio Lula da Silva and Donald Trump have had a testy relationship, in part because of Lula’s criticism of Big Tech. In February, at the AI Impact Summit in New Delhi, Lula called for global governance of AI, warning: “When few control the algorithms, it is not innovation, but domination. Regulating the so-called Big Tech companies is linked to the imperative of safeguarding human rights in the digital sphere, promoting information integrity, and protecting our countries’ creative industries.”

By sticking to his guns, Lula may now be seeing the tide turn. He was in the White House on May 7, and though neither he nor Trump took questions, both appeared encouraged by the meeting. “Very dynamic,” was how Trump described Lula, while Lula said he was “very, very satisfied” with how the talks went. With a general election in Brazil approaching in October, Lula will be sensitive to how the White House, as it has done in other elections, and Big Tech might offer vocal support for right wing candidates.

But his willingness to stand up to Big Tech is popular with voters. A recent poll found that 78% of Brazilians want to see tech companies being held responsible for the content they publish. Another poll found that 55% of Brazilians defend regulating Big Tech, with 43.9% against it. 

And as scams, fake news, and AI slop dominate ever larger swathes of all our digital space, in Brazil, as in much of the rest of the world, the entire experience of the internet is becoming more unappealing. Big Tech, with the assistance of the U.S. government, may be succeeding in slowing down the pace of regulation and watering down the content of that regulation, but in the long run its victories might be pyrrhic. People have had enough and their governments might be forced to listen.

The post How Brazil is starting to rein in Big Tech appeared first on Coda Story.

On May 3, an unusual procession moved through Washington DC. Several hundred people walked beneath the monuments of the American capital carrying portraits of Red Army soldiers. Children waved Soviet flags. A live orchestra played wartime songs at the World War II memorial. The Russian embassy had filed the permit; the DC Metropolitan Police provided an escort. Russian state media celebrated the event as proof that, with the return of Donald Trump, historical truth too had returned to America.

One organizer told Russian state television: “We love, respect Russia, honor the memory of our heroes.”

Similar marches took place in Paris, Amsterdam and Busan. In Berlin, authorities announced that Soviet flags, Russian symbols and military songs would once again be banned near Soviet war memorials during May 8 and 9 commemorations.

But in Moscow, Victory Day itself appeared haunted by fear.

For decades, May 9 has been Russia’s most sacred annual political ritual, binding victory, patriotism and state power into a single language. But this year, Kremlin spokesman Dmitry Peskov was reduced to announcing that the Immortal Regiment march in Moscow would continue only “in electronic format.”

The run up to this year’s Victory Day became the most anxious Moscow has experienced in recent memory. The Kremlin canceled the traditional procession in the Russian capital, moving it online. Military equipment was removed from the parade. Mobile internet access across Moscow was intermittently shut down in the days leading up to May 9. Spectator numbers in St. Petersburg were reportedly slashed from thousands to just a few hundred. The Victory Parade in Kaliningrad was canceled entirely. Russian media outlets published extraordinary reports about Vladimir Putin retreating deeper into protected bunkers amid fears of Ukrainian drone strikes and assassination attempts.

Russia’s Foreign Ministry even warned foreign governments to evacuate diplomats from Kyiv before May 9, threatening massive retaliation if Ukraine targeted the celebrations with drones.

And then came another extraordinary twist. Volodymyr Zelensky publicly “allowed” the parade to proceed. In a deliberately tongue-in-cheek decree issued after negotiations around a temporary ceasefire, the Ukrainian president formally excluded Red Square from Ukraine’s operational strike plans for the duration of the celebrations, even listing the exact geographic coordinates of the square itself.

Watching it all unfold, I kept wondering whether empires collapse more easily than the systems of feeling they create. The Soviet Union fell apart more than 30 years ago, but the architecture built around victory, sacrifice and historical grievance survived it, stretching across borders, diasporas and rival political projects. What began as Soviet myth-making about liberation has evolved into a transnational political language through which governments, activists, diasporas and rival ideological movements compete over legitimacy, victimhood and belonging.

Over the years, at Coda, in our Rewriting History current, we have tracked how the remembrance of World War II became central to Putin’s machinery of legitimacy and repression. Soon after he came to power, Russian public culture became saturated with stories of the Great Patriotic War. Watching Russian state television often felt as if the war had ended yesterday. New films, schoolbooks, drama series, speeches, parades and television specials turned victory into the emotional foundation of Putin’s Russia. Scholars of Russian memory politics have described how, under Putin, collective memory of the war became a tool for claiming legitimacy, discrediting opposition and presenting the Russian state as the eternal defender against fascism.

 It resonated because it tapped into genuine emotion passed on for generations. It was never just propaganda. It rested on something real: the scale of Soviet loss and the private grief carried by millions of families.

The Immortal Regiment began in 2012 in the Siberian city of Tomsk as a local act of remembrance. Ordinary people walked through the streets carrying photographs of relatives who died in the war. By 2015, Putin was leading the Moscow procession himself, while state-backed organizations coordinated chapters in dozens of countries. But in Putin’s Russia, where victory had already become the central organizing myth of the state, the boundary between private mourning and political mythology dissolved.

The speed of that transformation still feels important to me. It says something about the way modern political systems absorb private emotion and fold it back into the language of the state.

The Kremlin framed these Victory Day rituals as a defense against what it called Western attempts to “rewrite history” by minimizing the Soviet role in defeating fascism or equating Stalinism with Nazism. Ukraine and many Eastern Europeans came to see the marches instead as vehicles for imperial nostalgia and wartime propaganda. 

But the argument, it seems, is no longer only about what happened in the past. It is about who gets to turn memory and grief into political legitimacy in the present.

This year Germany found itself in the extraordinary position of having to ban Soviet flags and military songs near Soviet memorials, effectively regulating the symbolic language of antifascism itself. Historian Timothy Snyder once warned that “if fascists take over the mantle of antifascism, the memory of the Holocaust will itself be altered.” That is precisely the moral and historical dilemma Berlin has now forced into the open. What happens when the symbols of genuine antifascist sacrifice become inseparable from the imagery of an ongoing war? When the flags carried by the soldiers who liberated Auschwitz are also flown at embassy-organized rallies while Russian bombs fall on Kharkiv? 

At Coda, we explored some of these tensions years ago, in our documentary “What To Do With Stalin,” which examined the strange afterlife of Stalin’s image across the former Soviet world. While filming in Georgia, we encountered arguments that now feel strikingly familiar: whether remembering Stalin represented patriotism or denial, historical pride or historical amnesia.

https://www.youtube.com/watch?v=NdfTH6rfe7E

Even then, it was obvious these battles were never really about the past.

Putin himself acknowledged as much during this year’s Victory Day speech, describing the war in Ukraine as a “just” continuation of the struggle against fascism and accusing the West of fueling confrontation with Russia “to this day.” Hours later, he suggested the war might finally be over. “I think that the matter is coming to an end,” he told reporters.

Victory Day 2026 may ultimately be remembered not for the military parade itself, but for revealing how unstable that memory system has become. Moscow performed triumph while fearing attack. Berlin restricted Soviet symbols in the name of democratic security. Washington hosted embassy-linked Soviet commemorations beneath American monuments.

I was ten years old when the Soviet Union collapsed. For those of us who grew up inside it, the end of the empire felt at once chaotic and exhilarating. Borders opened, old certainties disappeared and ideology lost its grip almost overnight. I still feel fortunate that, as a child, I witnessed an empire built on terror and repression collapse into history.

In the decades that followed, we watched Russia slowly turn the symbols and emotional reflexes of the Soviet system into instruments of political power once again. Victory Day became one of the most potent of these instruments: a ritual that fused together grief, patriotism, historical trauma and state legitimacy into a single, powerful sentiment.

Russia’s ambassador to Washington, Alexander Darchiev, praised what he described as the Trump administration’s dramatically changed attitude toward Victory Day commemorations. The holiday, he said, now played “an unequivocally positive role” in Russia-US relations. He pointed specifically to the marches held in the center of Washington, DC.

But the more I think about this year’s Victory Day, the less it feels like a story about Russia alone. When the Soviet Union collapsed, many of us assumed its emotional architecture would disappear with it. Instead, parts of it were patiently cultivated and repurposed for a new era by the men in charge of Putin’s Russia.  

The emotional logic that once underpinned the Soviet system no longer belongs only to Russia and the shattered geography of its former empire. Grievances, historical trauma and rituals of belonging now shape political life all around the world. Digital networks and algorithmic systems did not create these emotional impulses, but they amplified them at a scale the Soviet state could only dream of. Perhaps that is the true afterlife of an empire: not the survival of its borders or ideology, but of the emotional systems it builds to organize fear, belonging and historical destiny.

Additional research by Masho Lomashvili and Irina Matchavariani

The post The afterlife of empire appeared first on Coda Story.

Inequality is bad for you, and new figures in the UK show that the number of years when people can live healthy lives have fallen everywhere and furthest in the country’s poorest areas. This is partly a lingering after-effect of COVID, but is mostly a result of cuts imposed on health services by the last government. The results are dramatic, with the average person in a wealthy area expected to enjoy almost 20 years more good health than someone in a more deprived area. The situation in the United States is similar, and declines in health have also been observed in Germany, Canada and the Netherlands.

“Reducing smoking and improving diet and physical activity can delay the onset of illness and improve day-to-day wellbeing,” notes this extremely commonsensical analysis from the UK healthcare think tank The Health Foundation. “Secure work, good-quality housing and supportive local environments all influence physical and mental health.”

Being unhealthy is just terrible in all ways, and the problem is clearly getting worse, so you would expect the disrupters of our new economy to be finding ways to respond to this challenge. And at first glance, the Sam Altman-backed Retro Biosciences — with its focus on targeting “aging mechanisms to increase healthy lifespan” — looks promising. So does Altos Labs, with its mission to reverse “disease, injury, and the disabilities that can occur throughout life.” And there’s Saudi Arabia’s Hevolution, which is catalysing “the shift from lifespan to healthspan.”

And that’s before we get to the start-ups operating in a “free city” off the coast of Honduras, which has the brave approach of basically letting people do whatever medical research they like (“Prospera is a unique place where we can do such things,” says one businessman) to help drive progress towards an illness-free future.

But don’t get your hopes up. They’re not looking at ways to help people to get vaccinated, eat healthily, stop smoking or do more exercise. Instead, they’re working on gene therapy, stem cells, and other extremely expensive treatments that will only benefit people who can afford them, and who are thus already likely to be doing well. In the UK meanwhile, Genflow is also aiming to slow the ageing process in dogs, to make sure the super-rich aren’t left without their pets in this artificially prolonged future.

It’s tempting to see this as a metaphor for late-stage capitalism in the West, with its focus on the needs of the few (and their pets) rather than of society as a whole, except that we’re seeing a similar pattern in other places too. In Russia, Moscovites live longer than people from the provinces (although the picture is complicated by the relatively good health of the non-drinkers from Muslim regions), so you would have expected Vladimir Putin to be concerned about how to close that gap. But when he was chatting with Xi Jinping last year in China (where inequality has also harmed health), they were instead more focused on how to live forever. 

“Human organs can be continuously transplanted, and people can live younger and younger, and even achieve immortality,” Putin said. (Three important questions: firstly, does this mean he will be president of Russia literally forever, the world’s first un-dead head of state? Secondly, are they farming people as a source of organs for him? Thirdly, does he really believe this?)

“This century, there's a chance of also living to 150,” replied Xi, who could — under that scenario — rule China for another 77 years, which is longer than he’s been alive, by which time his nation’s population could well, according to UN estimates, have halved.

I, for one, wouldn’t mind having a vote on whether this is a future I want to be a part of.

An insider betting scam

Here’s a fascinating piece of research from the Anti-Corruption Data Collective about prediction markets, looking at how often “long shot” bets on military and security matters pay off compared to what you would expect: fully 52% succeed, compared to only 14% across Polymarket as a whole.

“Government officials and members of our military being able to turn a profit on insider information incentivises corrosive corruption in public office and undermines national security,” notes David Szakonyi, Co-Founder of the Anti-Corruption Data Collective.

The analysis follows the indictment of a U.S. serviceman who made $400,000 betting on the bid to capture Nicolas Maduro in Venezuela, with 13 “yes” wagers on various aspects of the operation in December and January. And that was only a comparatively small military campaign. Just imagine how much money privileged insiders could have made in the past, if only they’d had access to prediction markets before D-Day, before the first nuclear bomb test, or before the assassination of Archduke Ferdinand in Sarajevo.

I really enjoyed this recent episode of Planet Money about prediction markets, particularly with its clear explanation that — like so much “financial innovation” of the past — they’ve not invented anything new at all; they’ve just found a clever way around regulations that previously stopped people making bets in this way.

There is fierce competition between the two leading players — Kalshi and Polymarket — although they have common ground in one area: they both employ Donald Trump Jr.

Trump sues his own government

There are so many things happening in the United States at the moment that it’s hard to keep track, but I did like this analysis from David Allen Green of a particularly strange lawsuit, in which President Trump is suing the federal government for $10 billion. The judge is, unsurprisingly, concerned about a situation where the president is basically suing himself, and wants more information about how that’s going to work.

This could, however, be a whole new money-making front for the first family, and why should the Trumps stop at just $10 billion? They could presumably take the government for every penny it’s got. I’m amazed no one has done this before.

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

The post Wealth is health, Insider betting & Trump will see himself in court appeared first on Coda Story.

A coup is underway in Mali, though it has not brought down the governing junta just yet. The country’s military leader, General Assimi Goïta has, after days in hiding, appeared in public to claim, unconvincingly, that the “situation is under control.” But rebel forces — an alliance of Al-Qaeda affiliates and Tuareg separatists — have taken over provincial cities and are calling for a blockade of the capital Bamako. Mali’s military junta hangs on by a thread, in a familiar regional story of violence, civilian suffering and international intrigue.

On April 25, coordinated attacks across Mali exposed the junta’s fragile hold over the country. Jamaat Nusrat al-Islam wal-Muslimin (JNIM), the al-Qaeda affiliate that has driven insurgency across the region for over a decade, joined forces for the first time with Tuareg separatist groups — who have been fighting the central government for even longer — to simultaneously strike cities hundreds of miles apart, including the capital Bamako, Gao, Kidal, Sévaré, and the garrison town of Kati. A suicide car bomber drove into the residence of defence minister General Sadio Camara, killing him along with his wife, two grandchildren, and several civilians. Camara was one of the most influential figures in Mali's ruling junta and had been widely seen as a possible future leader of the country. He was also the key architect of Mali's military alliance with Russia. Mali, Burkina Faso and Niger, which together form the Alliance of Sahel States (AES), have all in recent years realigned away from France, the former colonial power in the region, and towards Russia.

Russian mercenaries, in the form of the Wagner Group and more recently the Africa Corps, have backed military juntas in the Sahel, after coups in Mali, Burkina Faso and Niger led to the withdrawal of French troops from France’s former colonies. But during these latest rebel strikes, it was Russian fighters that were chased out of the northern city of Kidal to the sound of jeers. Africa Corps, the Kremlin-controlled paramilitary group, described the insurgent attacks as a "coup attempt" backed by "Western intelligence services." RT amplified these claims, accusing France and the West of orchestrating the violence, even as it claimed Russian fighters successfully repelled rebels. In 2024, Ukraine’s military agency said it had provided information to help Tuareg rebels ambush and rout a Wagner convoy, killing dozens of Russian mercenaries. Both Mali and Niger have cut diplomatic ties with Kyiv. Burkina Faso has described Kyiv as a destabilizing force in the region, making the Sahel effectively a front in Russia’s war with Ukraine. 

The Kremlin’s combination of misinformation and mercenaries helped exploit growing anti-Western sentiments in the Sahel to give Russia a propaganda win in the region. Former colonial powers such as France didn’t help themselves, as can be seen even now in Madagascar, the latest nation to expel a French diplomat and accuse Paris of fomenting unrest. But the success of Russian propaganda hasn’t been matched on the ground. As Mali struggles to contain a rebel alliance that has fresh impetus and energy, Moscow’s control is weakening and the effectiveness of its military support is under question. Already, with Russian weapons in short supply because of war with Ukraine, it is China that the Malian junta turns to for arms. China’s strategic efforts in the Sahel have been similar to its efforts in the rest of the African continent – a focus on securing infrastructure contracts as part of the Belt and Road Initiative and securing access to mineral resources. But rebel attacks in the Sahel are bad for Chinese business. In February, the Chinese embassy in Niamey, the capital of Niger, warned Chinese companies to take their workers out of the firing line as rebels increasingly targeted Chinese infrastructure projects, including a $4.5 billion oil pipeline from Niger to Benin.

In 2024, the United States was forced to leave neighboring Niger after a coup, to withdraw from a $100 million base. It seemed the U.S. was losing ground to both Russia and China in the Sahel. Earlier this year, though, as security concerns in the Sahel escalated sharply, the U.S. adjusted its approach, choosing to deal pragmatically with military juntas. By late February, the U.S. lifted sanctions on top Malian officials, including General Camara, the recently slain defence minister. It may see closer cooperation with Sahel countries as essential to its security interests and a way to undercut Chinese access to Sahelian resources.

The three Sahel states, Mali, Burkina Faso and Niger, have turned away from France and Europe and towards Russia, while increasingly flirting with the U.S. and reliant on Chinese weapons. The result has been disaster. All three Sahel states are ranked in the top 5 for countries impacted by terrorism. And the humanitarian toll has been severe. Millions of people face internal displacement across the region and cuts in aid programmes mean many millions, especially children, also face acute hunger. But, as the great powers circle the region, jockeying for geopolitical gain, the talk remains about the logistics of propping up failing juntas, providing military solutions to human crises, and maintaining power rather than confronting problems.

Mali, Burkina Faso and Niger – all led by military authorities that came to power in a coup – have also isolated themselves from the rest of their neighbors by withdrawing from the West African regional bloc, Ecowas. Meanwhile, they sell their model as an alternative to Western-style democracy, a narrative that Russian propaganda networks have been all too eager to promote. But the strength of the insurgency against Mali’s government, and Russia’s apparent inability to protect it, sends a different message to the rest of the African continent.

The post Why an insurgency in Mali matters in Moscow appeared first on Coda Story.

Donald Trump and the crypto world have done well out of each other. The Trump family has made profits of several billion dollars, and ‘cryptopreneurs’ have found the United States a newly supportive environment for their products. But the crypto world is not a single entity, and there are potential differences of opinion and approach between the parts that specialise in fraud, money laundering, and speculation (as well as the small number of societally beneficial uses), and a court case between billionaire Justin Sun and the Trump family’s World Liberty Financial threatens to blow those divides wide open.

He also had a key role in transforming Trump from cryptosceptic into cryptoenthusiast after investing millions of dollars in World Liberty Financial in late 2024, which helped to persuade the president — then running for re-election — that there was money to be made on the blockchain. 

Considering the improbability of the Trump family building an actually successful crypto company, and the strong likelihood World Liberty Financial would find a way to keep investors’ money as has happened with Trump ventures in the past, quite a lot of people assumed Sun’s money was in reality more of a gift than an investment. But it appears these doubters were wrong, at any rate that’s what it says in the suit that Sun has filed in California alleging that World Liberty Financial has abused his rights.

“Mr. Sun invested $45 million to purchase $WLFI tokens from World Liberty not only because of the project’s claims that it would promote adoption of decentralized finance… but also because of the Trump family’s association with the project,” his claim states. “But as Mr. Sun unfortunately has learned, World Liberty’s operators, including Chase Herro, see the project as a golden opportunity to leverage the Trump brand to profit through fraud.”

Sun has been careful to make clear this is not an attack on the president (“Unfortunately, certain individuals on the World Liberty project team have been operating the project in a manner that goes against President Trump’s values,” he posted on X), who is, he says, being betrayed by underlings — as autocrats have always been throughout history —  but he is certainly airing a lot of dirty laundry, which is likely to upset influential people.

Perhaps the most significant allegations, which World Liberty Financial denies, is that the Trump family’s company is on the verge of collapse, having paid most of its money to its owners, and that it tried to extort money from Sun to keep it in business. This is not just significant for its investors but also for America’s diplomatic ties, since Abu Dhabi has invested $2 billion via World Liberty Financial’s USD1 stablecoin, and the United States can ill-afford to further irritate its allies in the Gulf right now.

The timing of the lawsuit is interesting. It was notable that, shortly after Trump returned to the White House, the Securities and Exchange Commission paused its investigation into Sun. In March, that investigation was finally wrapped up, with Sun paying $10 million but not admitting wrong-doing, so he is perhaps no longer concerned about facing legal action himself.

Sun was also a major investor in Trump’s memecoin, but is not the only person who seems to have soured on that particularly unlovely project. One of the perks of being an investor in the token is the right to have dinner with Trump, but the value of that ticket dropped this year to just $539,000 from $3.28 million in 2025, with the Financial Times quoting an expert as calling the friendship between Trump and the crypto-world “a shotgun marriage,” which seems fair.

The Trump family has, however, made $320 million in fees from the memecoin alone, so I suspect they’re not that bothered.

A tale of two scammers

There was, hard though it is to imagine, a time when Trump was just a strangely-tinted TV personality with strong views on where Barack Obama was born. And back then, in those prelapsarian days, 2014’s billion-dollar Moldovan bank fraud was a big deal. It’s great to see that mega-oligarch Vlad Plahotniuc has been jailed for 19 years for his involvement in a crime that ruined his homeland.

Moldova has struggled through the resulting period of economic, financial, diplomatic and political turmoil, and it was great to see that Viktor Orbán’s defeat in Hungary has meant it can make progress on its movement towards membership of the European Union.

The other mastermind of the bank fraud is pro-Kremlin politician Ilan Shor who was convicted and sentenced in absentia. He remains, of course, at liberty. Though his A7A5 sanctions-evading cryptocurrency has still not recovered the trading volume it had before the recent hack of the Grinex trading platform where people bought and sold it. Grinex blamed the hack on Western intelligence agencies, but Chainalysis has an interesting alternative explanation, based on the fact that A7A5 is gradually being squeezed by Western sanctions (including the latest ones from the European Union).

“Faced with mounting international pressure and a shrinking operational footprint, actors associated with Grinex could be using the guise of an alleged hack to quietly siphon liquidity and execute an exit scam,” Chainalysis suggested. I’m not saying that is what happened and to be honest, I think it’s more likely that this was the handiwork of Ukrainian hackers or standard financial criminals. I mention it, however, because Shor does have a previous record when it comes to setting up a money laundering scheme and then defrauding everyone who was foolish enough to trust him with their money. 

The billion-dollar bank fraud was a clever way to profit out of the ‘Moldovan Laundromat,’ which had been allowing Russians to smuggle money out of their homeland before Shor and his co-conspirators destroyed the Moldovan banking system and stole everyone’s cash. It would be remarkable if he had basically done the same thing for a second time with his stablecoin. Crypto people call it a rug pull.

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

The post Why Trump-backer Justin Sun is suing the Trumps’ firm appeared first on Coda Story.

It starts with a simple search term in the Department of Justice’s Epstein Library. “Blue eyes.” Hundreds of results. Jeffrey Epstein’s international trafficking agents send him pictures and descriptions of blue-eyed young girls: potential victims to be dispatched to his various homes. “I spotted two skinny blond blue eyes 21 years old ladies in Monaco last weekend and asked them for CVs,” one agent, whose name has been redacted, wrote. “Trying her best to move from her small town to Moscow; English isn't great. Could be fun for Paris, blue eyes,” wrote another. “Can't understand if her breast is real. Otherwise very pretty and sweet…Very blue eyes as we like.” 

One of Epstein’s victims wrote of being chosen for her eye color in a journal entry later shared with federal prosecutors. "Superior gene pool?!? Why me?" she wrote, describing Epstein's worldview as "Nazi like." "It makes no sense. Why my hair color and eye color?" 

Epstein — himself blue-eyed — seemed to prefer both his victims, and the people he bankrolled, to have blue eyes. “All of my fundees have blue eyes,” he boasted in one email. In the entryway of his Manhattan townhouse, he displayed dozens of prosthetic eyeballs in a frame. Epstein made notes and sent article links to his contacts asking if having blue eyes meant you were more intelligent or a “genius”. He even had a list of scientists and tech leaders with blue eyes — including Elon Musk, Peter Thiel, and Google’s Ray Kurzweil. “Total — 70 people Blue eyes — 41 Unclear (might be blue, but not 100% sure)” the list says. Appearing in the files — whether on this list or elsewhere in Epstein's records — does not connote legal wrongdoing.

Going deeper into the files, Epstein and his network of contacts discussed beliefs about how physical characteristics and race might denote intelligence. They exchanged emails about population control. They spoke of engineering women’s sex drives, building designer babies, and living in a world full of superintelligent humans that could merge with robots. They spoke of getting rid of the elderly, the infirm, and the poor.

The files offer a glimpse into a world where ideas about eugenics and race science have never gone away. On the contrary, they run through our elite universities, through the most powerful companies in Silicon Valley, and through the tech industry itself. Epstein’s was an exclusive club that counted among its members people who harbor dreams of re-engineering human minds and bodies, seizing control of our collective future, and building technology that, they hope, will one day merge with — or even replace — all of us.

In 2002, two decades before the launch of ChatGPT, Epstein hosted an Artificial Intelligence summit on his Caribbean island. In the years that followed, he cultivated close, regular contact with a network of  (predominantly male) scientists, researchers, academics and tech leaders working at the vanguard of AI, biotech, genetics and cognitive science, meeting them at universities like Harvard and at his various homes. 

In August 2018, a year before Epstein was found dead in his jail cell, he was in email correspondence with software consultant and bitcoin investor Bryan Bishop about funding a project to create “designer babies” — children with genes cherrypicked for their looks, health, strength, immune systems, sleep needs and even, in Bishop’s imaginings, abilities to live on a different planet. 

  “Attached is the doc you requested, it's the "use of funds" spreadsheet for the designer baby and human cloning company,” Bishop wrote to Epstein. “This gets us out of our self-funded ‘garage biology’ phase to the first live birth of a human designer baby, and possibly a human clone, within 5 years. Once we reach the first birth, everything changes and the world will never be the same again.”

Bishop went on to discuss how his ultimate ambition was to make “practically unlimited modifications to the cells before generating an embryo.”

In response to a request for comment, Bishop sent Coda a publicly available set of answers to frequently asked questions about designer babies.

“The reason people have an aversion to eugenics, and rightfully so, is because countries used genocide and sterilization to prevent reproduction by populations that they didn’t like. We have no intention of doing anything of the sort,” Bishop writes in the public FAQ. “‘Designer baby’ simply describes a child whose genome has been intentionally altered or chosen by their parents, rather than left entirely to the genetic lottery of natural conception.”

“It’s such a great subject,” Epstein responded after he read Bishop’s proposal. “We need to get a read on legal. Can’t do anything where US rules apply to US citizens regardless of where [they are].” 

Building a super-race of humans, and parachuting humanity into a different evolutionary era — or even obsoleting the human race as we know it — is a running theme in the Epstein files, and an increasingly prominent ambition for tech evangelists today.

“It’s eugenics all the way down,” said Jacob Metcalf, a founding partner at Ethical Resolve, a consulting firm working with tech companies to develop their ethics protocols. A common fantasy in tech circles, he said, is “to essentially control human destiny. And a lot of the times that human destiny is for humans to be replaced. That's the really bleak thing here. What could be more eugenic than getting rid of humans.”

In 2008, Epstein began conversations with the computer scientist Ben Goertzel. Over the years, Epstein would send Goertzel more than $360,000 to fund the researcher’s plans to build towards Artificial General Intelligence (AGI), a term Goertzel himself popularized.

“I remain eager to move forward on working together to accelerate progress toward a human-obsoleting thinking machine,” Goertzel wrote to Epstein in May 2008. Eighteen years on, and the idea of obsoleting humans with artificial intelligence is widely discussed in the tech world.

When asked to comment on his exchange with Epstein, Goertzel told Coda: “I do think we will create forms of transhuman intelligence going beyond the scope of humanity as we know it, but I also very much hope and envision a strong role for humans even after this happens.”

Goertzel went on to describe a future where the world reaches the “Singularity” — a Silicon Valley buzzword signifying a tipping point where AI surpasses human intelligence. “I do think AI will eventually gain its own superhuman autonomy, but I think this can happen in a way that respects and nourishes human life rather than being harmful to it,” he said. “Epstein and I discussed this face to face a few times and indeed I was a bigger fan of the human species than he was, and more optimistic about its flourishing post-Singularity.” 

In an email to Epstein, Goertzel laid out a scenario where AI systems would start running their own economic activity. He envisioned this Artificial Intelligence economy acting as a “parasite to overcome the regular human economy” that would eventually “gain its own superhuman autonomy.” The ideas Epstein and Goertzel exchanged mirror a broader conversation unfolding in the tech world that imagines a future where ultimately, human labour could be rendered superfluous, and ultimately be replaced by artificial intelligence and robots.

Together, Goertzel and Epstein also discussed modifying human brains — a concept popular in Silicon Valley today, where numerous brain-computer projects are researching ways to cognitively enhance the human brain, and alter human personality, memory, and mental capabilities.

In 2008, when Epstein told Goertzel he was “off to jail” for a year, after he was convicted of soliciting a minor for prostitution, Goertzel suggested the solution to his problems might one day be solved if human brains could be re-programmed.

“According to my understanding, the girls you were involved with were old enough to know what they were doing, so society really has no ‘moral right’ to lock you up,” Goertzel wrote to Epstein. “This is a fucked-up society we live in. But past ones have really been no better -- the fault is really w/ the human brain architecture, which is precisely what I'm aiming to supercede in my AGI work.”

When asked to comment on these remarks — and in particular the implication that Epstein’s problems might be solved if his accusers' brains were one day re-engineered — Goertzel told Coda: “This was a general observation that the messed-up nature of our society generally is rooted in the way our brains have evolved... and that advanced tech will let us modify our brains to make ourselves and thus our society better.  There was no implication intended (nor stated) that women’s brains are any more or less messed up or in need of improvement than men’s.”

Goertzel reflected that his comments on Epstein’s victims being “old enough” were “regrettable and unfortunate in hindsight,” adding that his impression was that Epstein had been involved with adult women, not “disgustingly curating high school students for sexual purposes. I should have paid more attention.” 

In 2013, three and a half years after Epstein was released from jail, Goertzel approached Epstein for funding to build a “toddler robot”. Given Epstein’s criminal history of abusing minors, this has inevitably attracted attention online. “When we were discussing measuring the IQ of robot toddlers, the topic was never sexualized in any way,” Goertzel told Coda when asked about the project. “While I had nothing to do with Epstein's perverse sexual tastes or abuse of women, what I have read about his awful doings in the newspapers relates to his interest in teenage girls not toddlers.”

Epstein was particularly interested in funding projects that built — like Goertzel’s –- on transhumanist theories. Transhumanism is a worldview that captivates many of the most prominent tech leaders in Silicon Valley today. It believes in a future when the human body can be endlessly altered, genetically engineered, and ultimately fused with artificial intelligence. 

“Transhumanism is a much more radical concept than eugenics,” explained Timnit Gebru, a computer scientist and researcher who has written extensively about eugenicist ideas within artificial intelligence. “In eugenics, you're trying to create a more superior human by breeding humans through generations. In transhumanism, you're trying to get rid of humans altogether.”

For transhumanists, she added, “their idea is to get rid of any undesirable properties they see with humans."

Perhaps the most well-known proponent of transhumanism in the Epstein files is Peter Thiel.

“I think you would prefer the human race to endure, right?” New York Times journalist Ross Douthat asked Thiel last year. “Uh—,” Thiel said. “This is a long hesitation!” Douthat said. “Should the human race survive?” “Yes, but I would like us to radically solve these problems,” Thiel said. “We want you to be able to change your heart and change your mind and change your whole body.”

Thiel’s name appears in the files more than 2000 times, and Epstein reportedly invested some $40 million into Valar Ventures, a firm co-founded by Thiel. The two spoke of building secret societies and shared an interest in transhumanism and cryogenics — Epstein wanted to freeze his brain and penis when he died, so that one day he could be revived, while Thiel has also stated his body will be frozen after his death. 

They also appeared to share an interest in bringing an end to the democratic systems of today, imagining a different system altogether. Epstein, for his part, spent his life puppeteering the most powerful people in the world and undermining democratic systems. Thiel, meanwhile, first expressed his own anti-democratic views in 2009 when he wrote: “I no longer believe that freedom and democracy are compatible,” adding that since women were allowed to vote, the notion of a capitalist democracy became impossible. When the Brexit vote came through, Epstein wrote to Thiel: “Brexit, just the beginning.” Thiel asked — “of what”; Epstein said – “Return to tribalism, counter to globalization, amazing new alliances.” 

Globalization — and the idea of internationally powerful governing bodies — is a worldview that both Epstein and Thiel seemed to distrust. In March, in a palazzo in Rome, a stone’s throw from the Vatican, Thiel gave one of his infamous lectures in which he espoused his views about an “antichrist” that gets in the way of technological progress. This antichrist, he suggested, could be an internationally powerful body; the product of globalization. I stood outside the palace as attendees — priests, students, researchers — mutely hurried out, refusing to speak to the cluster of reporters waiting for Thiel’s black Mercedes. 

“He has a totally irrational side, which lives on fear, of what danger might happen,” one audience member told me of Thiel on condition of anonymity, recalling how, up close, Thiel looked haunted and ill. “His head is full of future scenarios, which is what’s killing him. I think he’s scared.”

Thiel did not respond to multiple requests for comment. 

Epstein didn’t confine himself to lofty conversations about a future collapse of the global order or re-engineering humanity. He also had ambitions for his own personal eugenics project. In 2019, it emerged that he wanted to seed the world with his DNA — and reportedly have 20 women impregnated at a time at Zorro ranch, his New Mexico property.

Epstein tried to recruit Virginia Giuffre for this very project. He “fantasized about improving the human race by fathering children who carried his superior genes,” she recounted in her memoir, published posthumously late last year.  “He’d talk about using his Zorro ranch as a literal breeding ground to propagate babies.” When Giuffre was 18 years old, she recalled, Epstein asked if she would carry his child and hand over all legal rights to it – “like a modern-day handmaid.”

In a haunting diary entry from another Epstein victim, written between the ages of 16 and 17 and shared with federal prosecutors, a girl describes being told she will be sent to Zorro ranch — possibly to participate in the very same project. “Go to New Mexico? What in the hell? This makes no sense. What about school?” she writes, describing how Epstein chose her for her hair color and eye color, and tried to convince her she would create “perfect offspring.”

The teenager chronicles her pregnancy, pasting a sonogram into the scrapbook, before giving a traumatic account of giving birth with Ghislaine Maxwell beside her. “Ghislaine said to push all the pain away. I don't understand. Blood and water all over the bed.” As the baby was born, she writes, Maxwell covered her eyes. “I saw between her fingers this tiny head and body in the doctors hands.”

The girl describes hearing the baby’s “tiny cries” before “they took her.”

“I’m nothing but your property and incubator,” the teenager writes of Epstein. The diary is a terrifying piece of evidence that appears to link to Epstein’s longstanding fixation with creating genetically bespoke humans. The diary author’s lawyers, Wigdor LLP, declined to comment.   

Epstein’s fever-dreams of creating an army of children carrying specific genes reflect a broader trend of “pronatalism” — a movement historically tied to eugenics — that’s thriving in Silicon Valley.

 Millions of dollars of funding are currently being poured into projects creating “superbabies,” while billionaire tech oligarchs including Elon Musk — whose name appears more than 1000 times in the files — reportedly want to use surrogates “to reach legion-level before the apocalypse.” Musk did not respond to requests for comment.

In the files, women appear either as victims, as objects, or as vessels for genetic engineering experiments. They are an inconvenient reality, people to be controlled and re-booted. Epstein wrote a 2013 email implying that women “are like shrimp. You throw away the head and keep the body.” 

“The obsession with "artificial" life appears tied to a masculine desire to try control the production of life – ultimately ridding themselves of their dependency on women," said Gabriella Razzano, Co-Founder of OpenUp, a social impact tech lab based in Cape Town, who is also a senior advisor at the African AI Observatory. “I think there is important work to be done on tying the narratives that are very revealing in the Epstein files to understand how, and why, technology is being developed as it is.” 

The trading of ideas about intelligence — both artificial and human — takes a particularly sinister turn in a 2016 exchange between Epstein and the cognitive scientist and AI researcher Joscha Bach, whose research Epstein funded to the tune of $300,000.

Bach writes to Epstein about a study claiming that “black children outperform white children in motor development, even in very poor and socially disadvantaged households, but they lag behind (and never catch up) in cognitive development even after controlling for family income.”

Epstein responds with racist ideas about his notion of how to “make blacks smarter”, adding — “maybe climate change is a good way of dealing with overpopulation. The Earth’s forest fire. Potentially a good thing for the species,” before contemplating a world with “too many people,” where “many mass executions of the elderly and infirm make sense.” 

Epstein then imagines creating a future “Übermensch” — a superior human with cherry-picked attributes. “What I like is the idea that ubermensch could be the melding of humans, put together in one brain,” Epstein writes. This bespoke human, he suggests, would include traits from marginalized groups, who he appears to believe have a stronger awareness of how to navigate power structures because of their historical exclusion. “An increased motor system, an increased awareness, an increased status calculator (Blacks, jews, women). Ubermensch could be the combination of the best of humans, not the best of a specific race or gender. Fun idea.” 

Bach told Coda in a statement: “I was summarizing a scientific study in a private email. Studies like this get often abused in ideological discourse to justify discrimination, which I strongly oppose and condemn.”

“I am firmly opposed to any form of racial discrimination, and I reject the use of group-level statistical claims to make judgments about individuals or to justify unequal treatment.” 

He continued: “It goes without saying that if global warming were to lead to a reduction in the human population, it would be accompanied by immeasurable suffering. Our civilization would break down, leading to a return to dark ages, in which the elderly and infirm were often killed, because people could not support them, and often did not care about supporting them. Every reasonable person understands that this is horrible and not desirable in any way.”

Epstein “was often callous about human suffering in a way that I found disturbing but worth understanding, as a window into the perspectives of the rich and powerful,” Bach added. 

Alongside Epstein’s conversations about mass executions for the old and and the sick, he was also interested in Silicon Valley’s dream concept of living forever — he had numerous email conversations with the longevity guru Peter Attia about prolonging his own lifespan, and funded a Harvard project geared towards “the end of aging.” In an email to Attia, Epstein mused: “I’m not sure why women live past reproductive age at all.” Attia, who published a statement about his relationship to Epstein, did not respond to requests for comment. 

This interest in “longevity” — living for as long as possible, even living forever, is popular among the elite precisely because they find themselves in an elite class, says David Robert Grimes, a scientist and disinformation expert who has written about longevity and race science in Silicon Valley. “They're both sides of the same coin — the Silicon Valley eugenics, and also the longevity stuff. They promote an idea that ‘we are exclusive and we are special',” he said. "It helps them to justify deep social inequality."

The tech elite did not inherit this ideology by accident. Stanford University, the intellectual heart of Silicon Valley, was once a major hub for the American eugenics movement, which later helped to inspire Nazi race laws. Stanford’s founding president, David Starr Jordan, was a prominent eugenicist, campaigning for forced sterilization of people with undesirable genetic traits. The university removed his name from its buildings in 2020 — but in Palo Alto, his beliefs did not disappear with the nameplate.

"Instead of eugenics we just call it longevity or biohacking," Christopher Wylie, the Cambridge Analytica whistleblower who has spent years investigating Silicon Valley's belief systems, said on a panel with me at a journalism conference last year. "It's the same."

The ideology Epstein bankrolled in private is being built in public. It’s a vision of the future in which a select few get to upgrade and extend their lives, while tightening their grip on the systems that determine which humans are worth investing in — and which are not.

It sounds like a dark sci-fi fantasy, except, as the files show, that fantasy is being funded and pushed into reality. Most of us will never be in the rooms where these ideas are discussed. All of us will live with the results.

The post “All my fundees have blue eyes.” Epstein and the tech world’s dark ideology appeared first on Coda Story.

My name is Darina,” says an elfin teen, ponytail pulled through the back of her cap, and “next year I’ll be earning 150,000 rubles (nearly $2,000) a month.” Darina works at what she calls “the world’s largest drone factory,” helping to assemble versions of the Iranian Shahed drone. “My parents are proud of me. Wanna do the same?” She asks as she advertises a polytechnic in Tatarstan. The Russian government, in the face of war and looming demographic disaster, has been relaxing child labor laws since 2022, making it easier to put 14-year-olds to work. Now, legislators are open about the need to reform “outdated” restrictions on employing minors in industries that were “considered dangerous 20 years ago.” Drone production is not the only part of the war effort to which teenagers are being recruited. This month in a “content camp” in Moscow, soldiers and state media propagandists trained 120-plus teens on how to make videos, use AI, and grow their audiences as aspiring influencers. Vladislav Golovin, a former soldier and a leader of Russia’s Young Army Cadets National Movement, said the program had “created a huge team of kids who understand how to broadcast government values.” 

But many young people, subject to year-round conscription, subject to internet shut downs and subject to surveillance, have little desire to spread propaganda. Instead, according to Google Trends data, growing numbers of Russians are seeking information on how to emigrate. A new exodus would accelerate Russia’s deep demographic crisis. Already, up to a million people are thought to have left Russia since the full scale invasion of Ukraine in 2022. According to one recent count, nearly 210,000 Russian soldiers have been killed in the war with Ukraine, with other estimates suggesting over 1.2 million casualties, including 325,000 deaths. And Russian fertility rates are the lowest they have been for 200 years. Anton Kotyakov, the labor minister, has told Vladimir Putin that the country faces a labor shortage of 11 million people by 2030.

So concerning is this crisis that Rosstat, the national statistics agency, has stopped publishing monthly demographic data. State officials and local governors have been told to compete to come up with the most innovative solutions to a seemingly intractable problem. The pressure on Russian officials and the Kremlin is leading to desperate measures, including guidance from the Russian health ministry that women who say they do not want to have children should be referred to a psychologist. Nothing the Russian state has tried has worked, from financial incentives (extended even to schoolgirls under 18) to banning advertising that supposedly promotes “child-free” lifestyles and so-called “LGBTQ propaganda.”   

Alongside “anti-woke” policies disguised as family values, is rising xenophobia and anti-immigrant rhetoric that has led to a marked decline in the number of foreigners living in Russia. The Kremlin’s anti-migrant policies include a new system to monitor migrant workers through biometric registration, location tracking, and intensified police oversight. The Russian parliament is currently debating enhancing the number of offences that can be punished by deportation or substantially increased fines. Much of it is targeted at Russia’s Central Asian migrants who make up an overwhelming majority of immigrant labor. Some Central Asian governments, notably Kyrgyzstan and Tajikistan, have now urged their citizens to think twice about going to Russia for work. 

Russia has been publicizing political stunts such as its “shared values visa” in which applicants from 46, largely developed, nations are given temporary residence permits if they profess to support “traditional Russian values.” The visa, the Kremlin has said, is “Russia’s response to what it perceives as the harmful effects of Western neoliberal policies.” But only a tiny fraction of the immigrants Russia needs will be Westerners who apply for such a visa; instead, Russia has been diversifying its pool of migrant workers by looking further east. Around 72,000 work permits were issued to Indian nationals in 2025, up from just 5,000 in 2021. Russian officials have signaled they are ready to accept “unlimited” numbers of workers from South Asian countries like India, Sri Lanka, and Myanmar.

While the Kremlin is looking to South Asia and Africa to address its immediate need for workers (and soldiers), the ambition in the longer term is to boost Russian birthr rates, despite the signal failure of ongoing attempts. 

In the U.S., there have been several moves borrowed from the Kremlin’s playbook, including the restriction of abortion, the attempt to deny women birth control, and even alarm at the fall in teen pregnancies. But data released this month showed that women in the U.S. gave birth to 710,000 fewer babies in 2025 than they did in 2007, a reflection of two decades of steadily dropping birth rates. Russian demographer Salavat Abylkalikov, at the Leibniz Institute for East and Southeast European Studies in Germany, says “if the birth rate has fallen below the level of simple reproduction, it is almost impossible to raise it back.” Especially when financial incentives cover just a fraction of childcare costs. 

In any case, Abylkalikov says, “in Russia, death is much more profitable than birth: in Nizhny Novgorod Oblast, the government provides around 1,000,000 rubles (about $12,000) for each child, but if one person goes to war and dies, the family receives up to 12 million rubles in total. That's more than $120,000. This is the economy of death.” The evidence, from countries like Russia, Hungary and the U.S., is that appeals to tradition, to religion and to female “responsibility” do not work, when support for families is limited. And while migration is an obvious fix to demographic questions everywhere, it’s politically toxic.

Russia knows it is hurtling towards demographic doom but can do little to halt the momentum. Its policies are riddled with inconsistencies — a strong line in anti-migration rhetoric and bullying, while being forced to import workers and soldiers from Asia and Africa; a patriarchal view of women’s roles, mostly confined to the domestic, while increasingly reliant on women to take the jobs of the men who are fighting and dying in Putin's war; and encouraging more women to give birth, while employing children to build drones. With family values like these, no wonder young Russians are hesitant to procreate.

The post Teens making drones: Russia’s demographic collapse appeared first on Coda Story.

Someone recently asked me what mark out of 10 I’d give for the efforts of governments to tackle financial crime. It got me thinking about that one bright spot of recent times — the West’s response to Russia’s full-scale invasion of Ukraine four years ago — and how it is now looking. Back in 2022, a lot of us were pleasantly surprised by the speed and ambition with which Western governments sanctioned the Russian government, state-owned companies and wealthy individuals. While Western pressure did not prevent the war, the asset freezes did impose a real cost on those conducting it. Four years on, however, those sanctions are beginning to look a bit shopsoiled. If they began at 7/10, they’re now scoring a lot lower.

There are reasons for this: Donald Trump does not appear particularly interested in Ukraine; the now former Hungarian prime minister Viktor Orbán has been snarling things up; and so on, as laid out in this analysis from Tom Keatinge. To make things worse, Trump’s latest adventure in Iran has pushed the oil prices sharply higher, earning more money for Russia while also giving Trump cover to lift sanctions, a temporary measure he has recently extended.

Keatinge argues that European countries need to be far more focussed on going after Russia’s payment mechanisms, particularly digital. “The extent to which crypto activity supports Russia’s war effort is clear,” he writes, “yet repeated initiatives to elevate the importance of opening a concerted line of effort on this issue are ignored. This must change.”

I agree, though it won’t be easy, considering the diffuse crypto ecosystem, and the increasing sophistication of Russian involvement in it. As long as Telegram is willing to host markets, the markets will continue to function to some extent whatever Western countries do (see the story of Xinbi, a Chinese-language hub for illicit crypto.) However, it does look like someone somewhere has lost patience with the ease with which Russia is funding itself.

“The sanctioned Russia-linked cryptoasset exchange Grinex announced an immediate suspension of its operations, citing a ‘large-scale cyberattack,’” reports Elliptic. According to the statement, which Kyrgyzstan-registered Grinex posted on Telegram, it lost around $13 million worth of USDT in the hack, blaming the theft on Western intelligence agencies.

“Today the attempts to destabilise our fatherland’s financial sector hit a new level, with the direct theft of the assets of Russian citizens and companies with the involvement of complex cyberattacks,” the statement said. Grinex is the successor to Garantex, which was shut down just over a year ago after years of effort by Western law enforcement. I would be surprised if Western countries had decided to take direct action against Grinex, as the exchange claims they did. Westerners tend to be a bit too legalistic for this kind of smash-and-grab, and I would expect any operation to more closely resemble what worked a year ago, conducted with Tether’s cooperation.

Instead, I suspect this attack is the work of hacktivists, perhaps working for or with the Ukrainians. Whatever the answer, it is embarrassing for the Russians, shows their crypto-security is not impregnable, and has made a noticeable dent in trading volumes of the A7A5 ruble-denominated stablecoin, which has become a key sanctions evasion tool. Three birds with one stone.

The important point is that sanctions were never supposed to be permanent: they are a foreign policy tool, not a law enforcement one. Hundreds of billions of Russian-owned dollars are languishing in various frozen bank accounts, and Western countries need to start thinking about what to do with them. They can confiscate them, investigate them or — if they’re feeling brave — use their potential return as leverage to persuade wealthy Russians to break with the Kremlin. What they shouldn’t do is leave them as they are to gather dust.

Hopefully, now that Orbán is out of the way, European countries will be able to take firmer collective action but they also need to be imaginative, and to start behaving as if they actually want Ukraine to win, rather than just not lose.

A defeat for transparency 

Of course, the United States will have a lot to say about that too, and what it ends up saying about how to tackle the Russian crypto operations will depend on what happens in the midterm elections this year. So, it strikes me as a big deal that crypto firms are once more pouring tens of millions of dollars into campaign vehicles in their quest for, what they euphemistically refer to as, “regulatory clarity.” Among them, of course, is Tether.

If you’re wondering quite how it’s possible to spend that much money on elections, I draw your attention once more to the great Integrity Index, with its records for who’s been spending what. It boggles my mind that, for example, the three Democratic rivals to the Republicans’ Susan Collins for the Maine Senate seat have raised more than $17 million just for the primary. Collins herself has raised over $10.5 million. There really shouldn’t be that much money in politics.

Besides, when it comes to value for money, investing in court cases beats investing in politics every day of the week. I don’t know how much the (ironically) anonymous plaintiffs in the 2022 case against corporate transparency in Luxembourg paid their lawyers, but its effects just seem to keep compounding to the benefit of those who want to hide their wealth from society. 

The European Union’s retreat from revealing the ownership of shell companies has given cover for Britain’s tax havens as they resisted efforts from London to force them to open up their own corporate registries. It looks like those efforts may have finally failed. “We are committed to full transparency, but I don’t think there will be any turning back,” said the British Virgin Islands’ Junior Minister for Financial Services Lorna Smith in comments confirming that the islands are in fact very much not committed to full transparency.

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

The post Why Europe must disable Russia’s crypto ecosystem appeared first on Coda Story.