Liberland: A Newly Formed “Nation” Running On Cryptocurrency

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Economist Vit Jedlicka has created a virtual state, called Liberland, that runs on cryptocurrency donations and will launch its own token in the coming months. Half a million people have applied for citizenship to the “nation” – which sits on a sandbank stretching 7km next to the Danube River (between Croatia and Serbia), 10km south of the Hungarian border.

“The situation on the mainland in Liberland is still difficult as Croatian police illegally persecute all visitors and settlers,” Jedlicka told the Telegraph in an interview. “We are waiting for exoneration from the Croatian constitutional court but for now, our settlement has essentially moved to the river, where we host visitors almost on a daily basis.”

Liberland state-business is conducted over email, WhatsApp, and Skype, permitting the 100 like-minded Liberland representatives across the globe to stay in communication. The country is in the process of launching its own legal system on blockchain technology, and will begin distributing its own coin, Merit, on April 13th — which coincides with Liberland’s third anniversary. All those who pay taxes will, in turn, receive Merit, effectively granting donors a stake in the country.

“For many years, I worked for lowering taxes and regulations in the Czech Republic, but I suddenly realized that it would be easier to start a new country than to fix an existing one. We suffered 40 years of serious damage to our society under a communist regime and, unfortunately, many of the same people are in power again,” he says. “It seems that Czechs do not learn from their history. We see some of the same damage happening in other European countries, where taxation and regulation is strangling prosperity.”

The nation accepts Bitcoin, Bitcoin cash, and Ethereum donations to run its financial operations, and the state budget is distributed among almost a dozen cryptocurrencies. Putting yourself at the mercy of a potentially volatile asset might sound like a strange idea, but Jedlicka does not let this phase him: “For a few years of my life I worked as a financial markets analyst,” he says. “That gave me a fairly good understanding of the system we are living in.”

Liberland’s motto is “live and let live,” but right now it’s not that simple for Jedlicka, who jokes that his current home is “on a plane.” Jedlicka is constantly traveling the globe promoting his venture and meeting with representatives as well as other parties interested in creating similar libertarian-minded living spaces in Africa and Central America.

Croatian police are currently engaged in a game of cat and mouse with early Liberland “citizens,” who are regularly arrested and forcibly removed: Around 100 people have been arrested since the proclamation of Liberland in 2015. “We were charged with leaving Croatia and the Schengen zone illegally,” he says. But that’s not all bad, as, according to Jedlicka, “That is matter-of-fact confirmation that Liberland is not part of Croatia.”