Key takeaways:
Tron founder Justin Sun was elected to serve as the first Prime Minister of the self-proclaimed state Liberland. Liberland’s entire political and economic system is run on the blockchain. The tiny European country is mostly inhabited by “campers and people living on ships.”Justin Sun, founder of the Tron blockchain, was recently elected as the Speaker of Congress for the self-proclaimed libertarian state of Liberland in Eastern Europe.
After the vote, which was held on the blockchain, Liberland President Vít Jedlička nominated Sun to serve as acting Prime Minister.
In his acceptance speech, Sun said he was “very happy” to be elected as Liberland’s Prime Minister. He promised to “actively promote the idea of small government … [and] demonstrate that a minimalist government can bring stability and prosperity without excessive regulation or coercion.”
“By upholding this approach, we will further Liberland’s status as a beacon of freedom and individual autonomy,” Sun wrote in a long thread on X.
He said, in Liberland, “There are no forced obligations, taxes, or mandates imposed on its citizens. Everything is built on voluntary participation and mutual respect.”
As the Tron founder noted, Liberland is aiming to become “a global symbol of libertarian ideals,” with cryptocurrency and decentralized technology at the heart of this development. But what is Liberland? We look at the history and economy of this ambitious micronation.
What Is Liberland?
Liberland is a sovereign state founded on Apr. 13, 2015, by former Czech politician Vít Jedlička and his wife, Jana Markovicova, a former massage therapist. Jedlička currently serves as its President.
The state is located between Croatia and Serbia on the western bank of the Danube River and covers just 7 square kilometers (2.7 square miles) – that’s 224 times smaller than the city of London in the UK. It is now the third smallest sovereign state, after the Vatican and Monaco.
Liberland emerged as a disputed area after the breakup of Yugoslavia in 1991 and is not claimed by either Croatia or Serbia. The country of 1,000 people – who are called Liberlanders – is organized around the libertarian ideals of individual autonomy and political freedom – similar to the foundational principles of Bitcoin.
Taxes are voluntary, and citizens are not required to serve in the military. Since August 2023, the country has been permanently inhabited, mostly by “campers, adventurers, and people living on ships.” Per its website, Liberland has even solemnized a wedding, hosted sporting events, and provided global aid as it looks to mature into full statehood.
However, while Liberland has received public backing from Argentina President Javier Milei and U.S. Congressman Ron Paul, the state is not recognized by the United Nations, raising doubts about its legitimacy. Officials say Liberland is working to change this diplomatic cold front.
The territory has signed Memoranda of Understanding (MOUs) with the governments of Argentina, El Salvador, and Somaliland in pursuit of state recognition.
Indian tech entrepreneur Evan Luthra, who was elected to the Liberland Congress alongside Sun on Oct. 6, said, “We’ve got supporters on every continent, 78 representative offices worldwide, and 4 ministries.”
Liberland’s Governance: ‘The People Are In Control’
Posting on X, Luthra said Liberland is “a place for people who believe that freedom isn’t just a privilege, but a fundamental right.” He said the state’s motto, “To live and let live”, is reflective of this spirit of freedom.
According to the entrepreneur, Liberland’s entire political and economic system is run on the blockchain, meaning “every move, every vote, and every decision is transparent and secure.”
Luthra said, “You won’t find any backroom deals or corrupt officials here. The people are in control.”
The country runs a proprietary blockchain called the “The Liberland Blockchain,” which uses a so-called nominated proof-of-stake (NPoS) consensus mechanism. Anyone may participate as a nominator, while only citizens can secure the network as validators – something that can provide a layer of security against malicious actors.
The Ethereum blockchain’s proof-of-stake model is considered far more climate-friendly than the Bitcoin network’s proof-of-work consensus mechanism.
Liberland uses a token called the Liberland dollar, or LLD, for operational transactions. LLD is used to pay for gas fees, run contracts, operate companies, and engage with the courts. Validators can earn rewards by staking their LLD, which can be traded on exchanges like MEXC and Coinstore.
At the time of writing, LLD is trading at around $3 on the Solana blockchain, with a market capitalization of over $200,000. It came after a portion of Liberland Dollar’s supply was bridged to Solana on Oct. 15 and deployed through Raydium. The token was already live on the Ethereum network.
Another token called Liberland merit (LLM) is used for governance. Universal suffrage does not exist in Liberland. To participate in political processes like voting, you will need to stake a minimum of 5,000 LLM and be a citizen or hold an e-Residency permit, both of which are sold. LLMs can also be earned through any work-related activities in Liberland.
For Liberlanders, political power is proportional to the amount of tax they pay when staking their LLM. The process is known as “political pooling” or PolitiPooling. If you decide to unstake your tokens and your balance of pooled tokens falls below 5,000 LLM, you will no longer be able to vote in things like Congress elections, which take place every three months.
What About the Economy?
Liberland doesn’t have legal tender, which means currency competition, says Liberland Congressman Luthra. You can use Bitcoin (BTC), Ethereum (ETH), stablecoin USDT, and many other wrapped tokens – “all on the Liberland app, in a free and open marketplace.”
According to the Liberland website, the country’s government runs on a budget of $1 million per year. Citizens can also chip in by leasing assets to the state for free – like its representative office in Washington DC.
Around 90 companies have been registered in Liberland, officials claim, with over $4.5 million in total value locked in the country’s decentralized finance [DeFi] ecosystem. Transaction volumes have hit $6.4 million.
Luthra said businesses in the micronation can operate fully on-chain, with “contracts, shares, governance handled digitally under Liberland’s jurisdiction.” There’s zero corporate tax. However, it is not clear what sort of operations the companies are running. Still, Luthra noted:
“Liberland’s unique tax incentives and its position on the Danube open up opportunities for regional trade, cross-border business, and investment, directly boosting economic activity in neighboring countries.”
The economic spillover is starting to take shape. Luthra said projections show that by 2030, Serbia’s GDP could see an increase of over $8 billion, and Croatia’s could rise by $10 billion, thanks to Liberland’s “existence and its policies.” He did not say how the country arrived at these estimates.
How to Become a Citizen of Liberland
About 760,000 people have applied for citizenship in Liberland. Currently, the territory has around 1,000 registered citizens and more than 4000 so-called e-Residents.
To become a Liberlander, you can apply for citizenship on the country’s website. There are two options: e-Residency or full citizenship.
As an e-Resident, you can start a business in Liberland, get a government ID and gain access to other services. However, you will not get automatic physical residence, voting rights, or a national passport. The e-Residency will set you back between $150 and $1,000 depending on benefits.
For full citizenship, you will need to settle in Liberland physically. You can upgrade your e-Residency by visiting Liberland and staying there for seven days to be eligible to receive full citizenship. Gaining full Liberland citizenship can cost up to $10,100.
Drugheads, alcoholics, the feeble, and people with a criminal record are not welcome in the “free state” of Liberland, the country declares. So much for being free!
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