This is a brain dump on digital freedom. Web3 technologies offer huge opportunities and also the potential for extreme erosion of freedom.

Blockchain

Blockchain is the technology at the heart of Bitcoin. It is is a distributed ledger whereby all transactions are distributed across a network, and visible to all access points on the network.

Pros

Transparency. The main benefit is transparency because all computers on the network can see any change to the blockchain. So if a transaction has taken place it is recorded on the blockchain. This is unchangeable. This makes it easier to spot fraudulent activity in the system where it is being applied.

Smart contracts. Smart contracts are programatic contracts that are capable of automating many events when a specified condition is met. This has huge capabilities for reducing administrative fees. Examples of where this could be applied

1. Rental Agreements as Smart Contracts

  • Automation: The tenancy agreement can be encoded into a smart contract that automatically enforces terms (e.g., rent amount, payment dates, duration).
  • Transparency: All parties (landlord, tenant, and agency) can view the same tamper-proof contract on a blockchain.
  • Automatic execution: When conditions are met—such as payment received or contract expiration—the contract automatically executes the next step (e.g., transfer deposit, end tenancy).

Example:
A smart contract releases the digital keys to the tenant once the first rent and deposit are confirmed on-chain.

💸 2. Automated Rent Payments

  • Recurring payments: Smart contracts can handle monthly rent transfers automatically using blockchain-based stablecoins or connected payment rails.
  • Late fees: If payment is delayed, a pre-programmed penalty could apply automatically.
  • Receipts: Every payment is recorded immutably on the blockchain, reducing disputes.

Example:
The tenant’s wallet is programmed to release rent on the 1st of each month; the landlord’s wallet receives it instantly without needing manual invoicing.

🔐 3. Security Deposits

  • Escrow management: The smart contract can hold the deposit securely in escrow and only release it when both parties agree, or according to pre-defined conditions (e.g., inspection results).
  • Dispute resolution: If a disagreement arises, a neutral arbitration protocol (on-chain or off-chain) can trigger release of the correct portion of funds.

Bitcoin

Most people know what Bitcoin is but don’t fully understand it, as the technicalities are very complex. It is a DECENTRALISED digital currency based on blockchain technology. The key thing is transactions need to be verified by people called bitcoin miners who make money out of verifying all the transactions (using powerful computing power to solve computer riddles. Once they solve the riddle the transaction gets added onto the previous block and cannot be altered. Every transaction is visible to everyone else on the blockchain, so it is very transparent and resistant to fraud.

Pros

Decentralised. It is not controlled by a single entity like a government. This means that it is resistant to tampering by said entity for their own gains, whatever they may be.

Transparency. As mentioned, all transactions are visible, less prone to fraud, which is not so with traditional banking systems. Below are some examples of how a finance department could commit fraud, to give an idea of the kind of problems we aim to fix. Applying the use of bitcoin to the company would make it harder (or impossible) to do these things.

1. Manipulating Payment Processes

  • A finance officer could create fake vendor accounts or alter legitimate supplier details to redirect payments to their own bank account.
  • Example (for awareness): An employee enters a new supplier called “ABC Consulting Ltd” in the accounting system, but the bank details belong to them personally.
  • Prevention: Dual authorisation for new vendors, supplier verification calls, and automatic matching between invoices and approved purchase orders. Blockchain tech can be applied for account creation process, meaning new supplier will be visible to all nodes on blockchain. Same for payments to said account.

2. Expense Reimbursement Fraud

  • Submitting false or inflated claims for travel, supplies, or project expenses.
  • Prevention: Require receipts, manager approvals, and random audits. Blockchain smart contracts to manage manager approvals ensuring several people have visibility of expenses and are alerted (not possible to do it without anyone else seeing). eg payment triggers email to security group.

3. Payroll Fraud

  • Adding ghost employees (people who don’t exist) or continuing payments to ex-employees and diverting those funds.
  • Prevention: HR–Finance cross-checks, periodic staff audits, and independent payroll reconciliations.

4. Manipulating Financial Records

  • Adjusting journal entries or creating fake invoices to cover up unauthorized transfers.
  • Prevention: Segregation of duties — no one person should handle authorization, recording, and reconciliation.

CBDC

Central banking digital currency is a cryptocurrency that is owned and controlled by the central bank of a country, like the Bank of England. It is different from Bitcoin because it is a centralised form of digital currency — just like traditional money but in purely digital form (no cash). Bitcoin, on the other hand, is decentralised — it isn’t controlled by any government or institution, operates on a public blockchain, and has a fixed supply (21 million coins). In short, a CBDC is state-controlled digital money, while Bitcoin is peer-to-peer, borderless, and independent of central authority.

IT DOES NOT HAVE TO BE ON A BLOCKCHAIN so does not necessarily have the benefits mentioned of said technology. For example, the proposed BritCoin is not planning to be on blockchain.

For CBDCs benefits to be felt, it needs to get completely replace the old cash system. Here are some of the pros and cons of CBDC:

Pros

Coupled with digital ID companies and governments have the ability to greatly increase efficiency in all sectors. It is the combination of a completely digital banking system with other technologies, such as face recognition, artificial intelligence, internet of things that is incredibly attractive to governments and businesses.

Let’s take the example of supermarket theft. As soon as you walk into a supermarket, your face is captured on camera. If you have been several times in the same supermarket, artificial intelligence will be capable of matching your clothing to facial id, when the individual steals something and is caught on camera, if digital id and cbdc is in place, their bank account can be frozen at the click of a button. Then if benefits are linked to the digital id, their benefits can be frozen.

This can stop theft.

Another example, illegal immigration. You will not be able to get a job without digital id. Ok sounds like national insurance and passport. It is, except it will be linked to other things like, you guessed it – the banking system, ability to get benefits, ability to make doctors appointments etc..

So will unscrupulous employers avoid it as they sometime do already with national insurance? If it was just an ID, yes. However, as companies will likely be required to share all employees’ digital id with government, and if CBDC is in place, the government will be easily able to spot if digital payments align with the list of employees. Therefore it becomes very difficult to get away with it.

Danger zone

Potential for too much power

While it is easy to look at the huge benefits that are possible with digital ID, coupled with CBDC. It only works if we have a complete surveillance state. This comes with huge problems in terms of individual’s freedom. If a government has the ability to shut down an individual’s ability to purchase, access benefits, healthcare, at the click of a button, what are the downsides?

Political alignment.

A government can decide to punish, in small or extreme ways, an individual who is supportive of a particular political movement. For example, if you post on facebook, something that argues against digital currency, you may receive a negative mark against your name.

If you decide to protest against a war, eg Venezuela, or Palestine. the government, may send you warnings about your online behaviour. It may decide to go further and stop your ability to make large payments. It may stop your ability to get a job. It is clinical and impersonal, but deeply effective in reducing dissent.

Government lobbying

Many may argue, that governments are fairly ineffective and governments rarely carry out such treacherous acts. Governments rely heavily on corporate and state lobbying to fund election campaigns. If one of these entities, say the pharmaceutical lobby, decided to push a vaccine, where the stand to profit immensely from, they may corrupt governments into enforcing their agenda. So if you refuse to take a medicine, which is deemed to help a population by the same companies that stand to profit financially, they can shut you out of the banking system, stop you from posting online, get a job etc…

Summary

While it is clear that digital ID, linked to other services, has the potential to solve many problems, vastly increase efficiency and save government money, there is a very. real danger attached to making this huge step towards a completely digital future. We risk being at the mercy of governments and corporations, more so than we already are, and in the worst case scenario, we have no way of reversing it. Dissent will be easily stopped by stopping the dissenters ability to get a job, make payments, influence others via social media. It is in our opinion a step to far, and we need to raise awareness and fully debate the dangers vs the rewards before making this decision.