Canadian Truckers Are Funded with Bitcoin After $10 Million GoFundMe Campaign Was Shut Down
In Canada, truckers are protesting against vaccine mandates. A GoFundMe campaign in support of the protests was shut down. Subsequently, another fundraising campaign based on Bitcoin and the Lightning Network was initiated. With Tallycoin, a fundraiser of over 6 BTC, worth around $250,000 at the time of writing, from 3400+ individuals from all over the world is being conducted. This comes with advantages — such as privacy, censorship resistance, low transaction fees — and concerns. — Cedric Heidt, Philipp Sandner
What started as a relatively small convoy of Canadian truckers protesting against vaccine mandates in the trucking business has snowballed into a weeks-long protest action including the blockade of major infrastructure. Truckers driving to Ottawa planned to block the streets of the Canadian capital as they felt that the government was not listening to their desires regarding a right to choose as opposed to vaccine requirements.
With reports of similar movements starting across Europe, Ottawa residents struggling with the noise, far-right sympathizers among the protesters, and now GoFundMe suspending a campaign in support of the protests that had managed to raise around C$10 million ($7.8 million, €6.9 million), there is no shortage of controversy and headlines.
In a public statement on Friday, GoFundMe stated that they “now have evidence from law enforcement that the previously peaceful demonstration has become an occupation, with police reports of violence and other unlawful activity” as the reason for suspending the crowdfunding campaign. Adding that most funds are to be refunded or redirected to charities.
While this move by GoFundMe has been labeled by some as an attempt at censorship and undermining support for what was intended to be a peaceful protest, some activists have taken it upon themselves to find alternative ways to raise funds. One such attempt, via the website GiveSendGo, has managed to raise over $1m despite reporting heavy DDOS and bot attacks. Another attempt is being made by leveraging Bitcoin and the decentralized crowdfunding platform Tallycoin.
Tallycoin is a crowdfunding tool built on the Bitcoin network with tight integration of the Lightning Network, which enables instant transfers of Bitcoin with negligible fees. As opposed to conventional crowdfunding platforms, such as GoFundMe, Tallycoin does not take a portion of funds raised, and proceeds can be accessed directly by campaign organizers without the need for intermediaries, such as payment processors or banks.
One campaign “Bitcoin For Truckers”, started by a user going by the pseudonym Honkhonk Hodl, has managed to raise over 6BTC, worth around $250,000 at the time of writing, from 3400+ individuals from all over the world (see Figure 1).
Many campaign contributors are showing their support for the protests, voicing their disagreement with them, or simply leaving humorous remarks in their tip notes. Contributions with a lightning symbol have been made via the Lightning Network (see Figure 2).
The censorship-resistant nature of Bitcoin has previously made it useful as a tool for organizations outside of the political mainstream, such as when it was used by Wikileaks to raise funds after PayPal famously froze their accounts. At the time, Paypal stated “[Paypal] cannot be used for any activities that encourage, promote, facilitate or instruct others to engage in illegal activity”. According to some, the acceptance of donations in Bitcoin by WikiLeaks was a huge step forward for the adoption of Bitcoin.
Bitcoin, however, has also not been without controversy. From being used as a tool to purchase illegal substances in the early days, to the ongoing concerns about Bitcoins’ environmental impact. Bitcoin supporters argue “Bitcoin is the currency of freedom, and freedom can be messy at times”. Bitcoin isn’t impacted by concerns about image, reputation, and political pressure. It is a tool and it is up to the people how it is used. While the democratization of currency and financial tools is undoubtedly a good thing, in the case of the truckers in Ottawa, the local government has to now deal with an influx of funding coming from an unspecified crowd in an unstoppable way.
This campaign would likely not have been possible without the Lightning network. The increased adoption of Bitcoin over the years has led to an immense increase in the cost of transaction fees making it cumbersome to use, and completely impractical for small transactions. The Lightning Network was created as a solution for this issue around 2017. It acts as a mesh network built on top of the Bitcoin blockchain.
From 2017 until 2021 the Lightning Network has struggled to gain traction as not many people were using it. In September 2021 El Salvador voted to make Bitcoin legal tender, introducing a wallet for its citizens integrated with the Lightning Network. Could decentralized fundraising be the next step as one of the Lightning Network’s “killer apps”?
Some questions surrounding this situation remain. Most prominently, the pseudonymous nature of Bitcoin might be considered a double-edged sword, in that no one can verify who started a Tallycoin campaign unless the pseudonymous creator is well-known in the community. Plus, who can guarantee that the funds raised are used for the specified cause? Without guarantees or intermediaries, this will be a difficult task. Also, once successful, this fundraising mechanism may easily attract fundraisers that do not act in good faith such as scammers.
Furthermore, how are the truckers planning on spending their Bitcoin? Converting crypto assets to fiat currency (conventional, government-issued currency e.g. the dollar) via a centralized exchange may also end up with accounts being frozen. The ideal scenario for Lightning Network adoption is businesses sympathizing with the protesters’ cause allowing them to pay directly with Bitcoin via the Lightning Network. Politics aside, this situation seems to be an interesting opportunity for grassroots adoption of Bitcoin but should be cautiously monitored.
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Cedric Heidt is a research associate at the Frankfurt School Blockchain Center (FSBC) and an all-around crypto enthusiast. His main focus is currently on sustainability aspects of Bitcoin, play-to-earn gaming, and decentralized finance in general. You can contact him via LinkedIn or by mail.
Prof. Dr. Philipp Sandner has founded the Frankfurt School Blockchain Center (FSBC). From 2018 to 2021, he was ranked among the “top 30” economists by the Frankfurter Allgemeine Zeitung (FAZ), a major newspaper in Germany. He has been a member of the FinTech Council and the Digital Finance Forum of the Federal Ministry of Finance in Germany. He is also on the Board of Directors of FiveT Fintech Fund, 21e6 Capital and Blockchain Founders Group — companies active in venture capital financing for blockchain startups and crypto asset investment management. The expertise of Prof. Sandner includes crypto assets such as Bitcoin and Ethereum, decentralized finance (DeFi), the digital euro, tokenization of assets, and digital identity. You can contact him via mail (email@example.com) via LinkedIn or follow him on Twitter (@philippsandner).