OPINION — The 2025 Munich Security Conference may go down in history as the moment when an eight-decade post-World War II alliance between the United States and Europe began to rupture. In the runup to the meetings and then the conference itself, top U.S. officials said NATO membership was off the table for Ukraine, and that it was “unrealistic” for Ukraine to win back any of its territory (one-fifth of the country) that is now occupied by Russia; Vice President JD Vance criticized European nations for not being more open to the views of extreme nationalist parties; President Donald Trump held a ninety-minute conversation with Russian President Vladimir Putin that the Kremlin and the White House described in glowing terms; and as the Munich conference wound down, word spread that a Trump Administration delegation was headed to Saudi Arabia for talks on ending the Ukraine war – and that no Ukrainians or Europeans were invited to join.
It was a dizzying few days that left the Europeans in a state of confusion, and Ukrainian leaders in what many described as a mix of dismay and fury.
The Cipher Brief spoke to several experts who attended the Munich conference, among them Bill Browder, the CEO of Hermitage Capital Management and a longtime campaigner against human rights abuses in Russia. Browder warned that the developments may have left Kremlin officials “dancing the jig,” and European and Ukrainian leaders scrambling for a Plan B. He also said that $300 billion in frozen Russian assets may be at least one answer to Ukraine’s problems.
Browder spoke with Cipher Brief COO Brad Christian. Their conversation has been edited for length and clarity. You can watch the full conversation on the Cipher Brief YouTube channel.
The Cipher Brief: How would you describe the mood at the Munich conference — in particular the European mood – as they listened to JD Vance and other U.S. officials?
Browder: Well, I think it was quite a dramatic speech in the sense that here you had the U.S. Vice President not criticizing Russia, Iran, or China, but criticizing the UK, Germany, and Romania, and alluding to these countries being Soviet. I think everybody who was here was either angry or scratching their heads in bewilderment, because this is the first time that there’s been such a degrading and insulting speech coming out of a senior position in the United States towards Europe in any living memory.
The Cipher Brief: What do you think are going to be some of the immediate ramifications in the relationship between Europe and America, in particular at this time in which all eyes are watching very closely what’s going to happen with the negotiations between Russia and Ukraine and the United States?
Browder: In the Kremlin, they’re dancing the jig right now because this speech could have been written in Moscow. On the other hand, if JD Vance wanted to do the Europeans a favor by insulting them in such a humiliating way, it got everybody all together on one page, and putting aside a lot of their differences, to understand that Europe probably needs to be more decisive and act on their own at this point.
The Cipher Brief: What else has stood out to you so far from this year’s Munich Security Conference?
Browder: The main thing that everybody was talking about is what’s going to happen with Ukraine. Trump came up with this unacceptable approach towards peace, which is to sit down with Putin without the Ukrainians and without the Europeans. First of all, that’s not going to achieve peace, because you can’t have a peace negotiation if only one of the two warring parties are present in the negotiation. But what it also has done is it’s been a wake-up call – that if the U.S. is going to cut off military aid for Ukraine to try to effectively force a surrender, then Ukraine is going to have to figure out how to survive without U.S. money.
One of the big themes that I’ve been talking about here at the Munich Security Conference is the frozen Russian assets. There’s currently $300 billion of frozen Russian assets, most of which are held in the European Union. That could easily be a solution to the problem. There’s no need for America to continue funding Ukraine, because [Russian President Vladimir] Putin can fund Ukraine, and he can do so through the assets that hopefully the Europeans confiscate from Russia. That’s been a big part of my conversations, and it’s been an idea which I think has really found its moment, because of the 20 or so topics on Ukraine, this is the one that could save the day right here and right now.
The Cipher Brief: What do you think might be possible in terms of the West potentially using some of those frozen Russian assets? How likely is it at this point?
Browder: About a week after the war began, the West froze $300 billion of Russian central bank reserves. At the very beginning of the war, everyone thought the war would last a very short period of time. As the war has dragged on, people are saying, Well, OK, Russia has done, conservatively, a trillion dollars of damage to Ukraine, and there’s this $300 billion of money that’s been frozen. The first thought was that the money would be used to rebuild Ukraine. But as time has gone on, it’s becoming clearer and clearer that Ukraine needs the money for defense before there’s any rebuilding or reconstruction. The original idea was to keep the money intact, and to take the interest off that money and use that to help Ukraine. But now we’re in the situation where if the U.S. pulls out of funding military aid for Ukraine, they’re going to need a lot more money than just the interest. And so I would say that this is something which is now being actively discussed at the European Union level, at the G7 level. We’ll see where it goes; I would say there’s a high probability that this is one of the elements that comes into play to save Ukraine.
The Cipher Brief: In a scenario in which there was a concerted effort and approval to use those funds, how big of a deal would this be for Moscow?
Browder: I think it would be a game changer, because at this point Trump couldn’t dictate the terms of Ukraine’s surrender. Ukraine could carry on fighting until Ukraine wants to have a proper discussion, a proper peace settlement based on their interests. And that’s something that Russia and Putin don’t want at all. It would be a game changer for Ukraine.
The Cipher Brief: In terms of the financial conditions inside of Russia, we see headlines one day that suggest that sanctions have had a dramatic impact on the Russian economy, followed by headlines the next day that say Russia’s war economy is strengthening and Russia is spending more on military and defense than all of the EU combined. What’s your sense of where Russia is financially today?
Browder: I think Russia is in terrible shape. They have huge inflation. They have 23% interest rates. They’ve run down their domestic sovereign wealth fund, their rainy day fund. The economy is operating purely off the back of internally borrowed money to spend on war. They’ve lost all of their European customers for gas. The oil business is being decimated because of drone attacks on oil refineries. It’s a bad situation there, and it’s hard for me to imagine that it gets any better any time soon.
The idea that sanctions aren’t working, I think, is an idea that Putin was trying to spread so that the West would then start questioning whether we need to be tightening our own belts if they’re not working, but they are.
The Cipher Brief: As we all start looking ahead, what are you going to watching for over the coming weeks and months?
Browder: I think that the main thing we’re going to be looking at is how the Trump administration ultimately decides to treat Ukraine, whether military aid continues or it stops, and what kind of sanctions are lifted on Russia in some kind of proposed peace treaty. And then more broadly, I guess we want to see with this nastiness that we saw from JD Vance, whether there’s follow through from that or whether there’s an attempt to patch things up.
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