The return of Donald Trump in the White House is promising many things: mass deportations, an end to inflation, and perhaps the first cryptocurrency-friendly presidency, which is widely expected to loosen regulations on the emergent technology.
While that is music to the ears of crypto investors and enthusiasts who poured money into his campaign, there are other unlikely winners for such policies, including far-right extremists and terrorist organizations who are using crypto to finance their ends.
“Any loosening of regulations on crypto (or, frankly, the appearance of loosening) is likely to further increase extremists’ use of crypto,” says Jessica Davis, a former analyst at Canada’s spy agency and the president of Insight Threat Intelligence, a consultancy firm specializing in terrorist financing.
“While the integration of crypto into the traditional financial system is not a nefarious goal, steps to do so, without proper regulation and compliance with international counter-terrorist financing standards, will make it easier for terrorists to raise and move funds for their purposes.”
Already on election day, the Base, a designated neo-Nazi terrorist group under a years-long FBI investigation, was soliciting donations in cryptocurrency for its stateside paramilitary training.
“Supporters! We at the Base received some donations and we are quite happy as we are purchasing blanks and blank firing adapters for AR-15s so members can train in small unit tactics,” said the post on one of the group’s encrypted messaging accounts.
The post continued with a list of supplies fit for a military platoon: “We need further funding to help buy more 5.56 blanks, training courses, powerfilm USA foldable solar panels to charge batteries in the field, Carinthia Defence 4 sleeping bags, electronic earmuffs and mics, bump helmets, GoPros, thermal optics, and FPV drones in that order.
“We will be fully transparent with purchases so you all see we are buying the equipment so we can train,” it said.
The Base then advertised a Bitcoin wallet, which has yet to accrue any funds, and a Monero address – a privacy-focused cryptocurrency. Criminal organizations are also well known to change their wallets to avoid law enforcement and intelligence surveillance.
The group’s Russia-based leader had offered over the summer to pay a second-in-command up to $1,200 a month in crypto and other funds to train the group in the US in his stead, suggesting that an earlier round of fundraising succeeded.
But terrorists and extremists using crypto isn’t anything new: in recent years, everybody, from American neo-Nazis to Hamas, has tapped anonymous donations through crypto.
“We got a lot to pull off the next weeks, any and all support is massively helpful,” wrote the leader of the Blood Tribe in a 2023 post asking for money to finance an eventual march in Florida brandishing swastika flags. The same post also advertised Bitcoin and Monero wallets.
Davis said: “Over the last five years, there has been a steady increase in the number of terrorism cases involving cryptocurrency.”
“Extreme right groups and actors have, in particular, been quick to adopt cryptocurrency,” she said, adding: “They do so in part to avoid scrutiny at financial institutions, but also because cryptocurrency is often hyped by far-right influencers.”
Davis noted that the accelerationist terrorists, the kind who believe acts of chaos will hasten the end of world governments, see something else: “[They] see cryptocurrency either as something that can help bring about the collapse of society, or something that will survive that collapse.”
Unlike the incoming Trump administration, Joe Biden has been suspicious of crypto, seeing it as a potential national security threat. His SEC and the treasury department have cracked down on crypto exchanges and companies for what they see as avoiding securities and anti-money laundering laws.
In contrast, Trump announced his own cryptocurrency venture during the election season and has already named the asset-manager Howard Lutnick, a major pro-crypto advocate, as his new chief of the commerce department.
Mark Dwyer, an extremism funding investigator at the ADL, said the private sector had done little so far in curbing extremist financing, which includes the crypto space.
“Certain portions of the private sector have failed to act for years,” he said. “There is no regulatory oversight when it comes to extremist financing that would encourage those private sector actors to act.”
Bitcoin’s value has also boomed since Trump’s election win, while he promised on the campaign trail that he would establish a “strategic reserve” of the cryptocurrency.
Extremists already understand the appeal and usage of crypto exchanges and how best to maximize their value, even going so far as instructing followers how to exploit them.
“Do not send us Bitcoin from exchanges such as Coinbase,” wrote a publication affiliated with ex-leaders of Atomwaffen Division, a disbanded neo-Nazi group on several terror lists. “The only purpose for Coinbase and other exchanges is to easily buy Bitcoin for cheap then send it to your independent wallet for sending to us.”
On the far right, some have already begun using cryptocurrencies to specifically avoid identifying themselves in transactions between one another. On Telegram in August, a legal defense fund setup for the imprisoned white nationalist leader Robert Rundo called on followers to send money.
“If you are concerned about credit card donations under your name” said the post, “below are crypto addresses for Bitcoin, Ethereum and Monero donations”.
Besides legal funds, groups like the Base and others ask for myriad reasons to send crypto.
“Different entities have previously requested cryptocurrency donations to allegedly pay for equipment, the costs of making and spreading physical propaganda, web hosting, travel, legal, and prisoner support,” said Joshua Fisher-Birch, an analyst at the Counter Extremism Project. “Crypto is attractive to the extreme right because it is easy to create a wallet and solicit donations online.”
He said while the anonymity of crypto was an obvious plus, extremists who use it are interested in not being deplatformed by mainstream crowdfunding sites, which is why Monero, a Bitcoin alternative with a higher degree of untraceability, has become a darling of cybercriminals and terror groups alike.
“Monero has also become popular with pro-Islamic State and IS-linked propagandists, who have asked for Monero donations and have posted advice on how to purchase it,” he added.
