LONDON (Dec. 7) -- Julian Assange has told a London court that he intends to fight extradition to Sweden -- one of many legal, financial and security challenges faced by the embattled WikiLeaks founder.

The 39-year-old Australian was refused bail at the City of Westminster Magistrates' Court, where he appeared soon after giving himself up at a London police station this morning. Assange was asked by the judge whether he understood that he could consent to be extradited to Sweden, where he faces one count of rape, one of unlawful coercion and two counts of sexual molestation. The freedom of information campaigner, who denies all of the charges, responded, "I understand that, and I do not consent," The Associated Press reported.

It's not yet clear why Assange was declined bail, estimated at between $160,000 and $320,000 by British daily The Guardian. However, following WikiLeaks' release of hundreds of U.S. diplomatic cables -- a leak known as Cablegate -- nine days ago, he has slowly been denied access to his major sources of funding.

Visa Europe today suspended transfers to WikiLeaks "pending further investigation into the nature of its business and whether it contravenes Visa operating rules." Swiss authorities on Monday froze Assange's bank account, reported to contain about $41,000, after claiming he had provided false personal information. MasterCard blocked transfers to WikiLeaks Monday, saying the organization was involved in "illegal activity," according to CNet News. And online credit firm PayPal has refused to pass on donations to the whistle-blowing site.

A full hearing on Assange's extradition case is set for next week. If the judge then finds that there is sufficient evidence to justify his deportation, the extradition process can proceed. But, as the case of British UFO hacker Gary McKinnon has shown, when a U.K.-based defendant fights an extradition attempt, the case can drag on for years. (McKinnon is wanted by the U.S. for allegedly accessing Pentagon computers illegally.)

Assange's British lawyer said his client was looking forward to fighting the allegations in court. "It's about time we got to the end of the day and we got some truth, justice and rule of law," Mark Stephens told the BBC. "Julian Assange has been the one in hot pursuit to vindicate himself to clear his good name."

And a WikiLeaks spokesman today said the arrest will not stop the organization from releasing more secret documents. "WikiLeaks is operational. We are continuing on the same track as laid out before," Kristinn Hrafnsson told Reuters. "Any development with regards to Julian Assange will not change the plans we have with regards to the releases today and in the coming days."

Assange's legal woes relate to sex-crime allegations filed against him this summer by two women he met in Sweden, which has a far broader legal definition of rape than most Western nations do. The WikiLeaks founder has admitted having consensual sex with the women, and according to a recent AOL News story, the charges are connected with disagreements over condom use. Assange believes that "personal issues" motivated the original allegations, The Guardian reports, and that Sweden has subsequently behaved as a "cipher" for the U.S.

American Defense Secretary Robert Gates -- a longtime critic of the WikiLeaks project -- was certainly pleased to be told of Assange's arrest. "I haven't heard that, but it sounds like good news to me," he said during a visit to Afghanistan today, according to NBC News.

Stephens told the BBC this weekend that he was worried the attempt to extradite his client to Sweden could be a precursor to moving him to the U.S. "It doesn't escape my attention that Sweden was one of those lickspittle states which used its resources and its facilities for rendition flights" by the U.S. to transport terrorism suspects around the world for interrogation, he said.

However, Sweden has rejected claims that it is seeking Assange's extradition on political grounds. "This investigation has proceeded perfectly normally without any political pressure of any kind," Swedish prosecutor Marianne Ny told Agence France-Presse this weekend. "It is completely independent."

Assange and his lawyers have questioned that independence, noting that Sweden's chief prosecutor dropped the charges in September. The case was resurrected, Stephens claimed this weekend, only "after the intervention of a Swedish politician."

Although the sex crime allegations might be Assange's biggest worry at the moment, he could soon face legal challenges from governments troubled by WikiLeaks' recent release of diplomatic papers. U.S. Attorney General Eric Holder told reporters on Monday that he had authorized "a number of things to be done" to combat WikiLeaks' activities. Asked if he might launch a prosecution under the Espionage Act, Holder replied, "That is certainly something that might play a role, but there are other statutes, other tools at our disposal."

Australian Prime Minister Julia Gillard has said her administration is investigating filing charges against Assange. "Information would not be on WikiLeaks if there had not been an illegal act undertaken," she said this morning. "The Australian Federal Police is going to provide the government with some advice about potential criminal conduct of the individual involved." However, many lawyers have criticized those comments, saying there is no evidence that Assange has committed a crime in Australia or even the U.S.

Supporters of the WikiLeaks founder have now written an open letter to the prime minister demanding she offer him protection.

"First and foremost, Julian Assange is an Australian citizen who is entitled to the protection of his country and does not deserve to be betrayed by his country," one of the signatories, the prominent Australian barrister Julian Burnside, told Australia's ABC network. "Julia Gillard has been making it virtually impossible for Assange to return to Australia, where he is entitled to be. And she has even threatened to cancel his passport. That is an outrageous stance to take."

Should Assange eventually find himself sentenced to a spell in the slammer, or put on a plane to the U.S., he would still have one trump card left to play. His lawyer Stephens noted this weekend that thousands of Assange's supporters had downloaded a digital "thermonuclear device" -- an encrypted computer file containing all of the papers WikiLeaks has ever received, listing the names of spies, soldiers and sources.

If the open-government activist is jailed, or if any harm comes to him, the encryption code to that file would be released, unleashing a flood of damaging documents. According to The Guardian, WikiLeaks currently has no plans to do that.