Worst Use Case for Bitcoin; White Supremacy Groups Use Crypto to Their Advantage
Members of white supremacy groups, cut off from the financial mainstream because of their hate-filled ideologies, are turning to Bitcoin to fund their activities and grow their wealth.
You’ve heard it said a thousand times. Unsavory characters will choose Bitcoin to carry out their deeds.
Well that is increasingly the case in the U.S. where white supremacy groups are reportedly increasing their use of Bitcoin. The uptick stems from them being turned away from reputable financial institutions, such as PayPal and traditional banks because of the racist, sexist and other offensive speak that the spew.
Things came to a head for these groups following a particularly disturbing incident in the fall of 2017. Members of some of these groups, which also refer to themselves as alt-right, clashed with protesters, and one of the protesters was killed.
The incident sparked outrage, and these groups were further outcast from the mainstream. Many institutions didn’t want their business and severed ties completely.
Being cut off from financial institutions could be especially debilitating to these group because they often depend on donations to fund their activities, such as hosting their websites or staging their demonstrations.
Instead of fretting over the loss of access to traditional financial institutions, members of these groups have turned to Bitcoin.
Worst case use
As noted above, these groups thrive on donations. Given their ideologies, few of their members want to be tracked, or openly affiliated with these groups. Bitcoin affords these donors anonymity.
A cybersecurity researcher created a Twitter bot to track how these donations flowed. One of the things that was found was the increase in the use of wallets by groups affiliated with white supremacy and neo Nazism.
According to Mic.com:
“…while anyone can watch the money move in and out of accounts, it’s uncertain where the money travels to, who is contributing and how many other digital wallets are involved in the network of white supremacist bitcoin users.”
Growing wealth from hate?
Bitcoin could also be helping the participants in these groups grow their wealth. Many members have boasted about how the donations they’ve received in Bitcoin have led to hefty gains, as they too benefit from the rise in the crypto’s value.
The Washington Post reported:
“Extremist figures who invested in bitcoin as a bulwark against efforts to block their political activity now find themselves holding what amount to winning lottery tickets. The proceeds could be used to communicate political messages, organize events and keep websites online even as most mainstream hosting services shun them.”
A member of the Southern Poverty Law Center, a nonprofit group that tracks extremists, told the Washington Post the following:
“Bitcoin is allowing people in the movement to go beyond cash in an envelope or a check. It’s really a godsend to them.”
What’s being done
Shutting down these groups is nearly impossible. While cutting off their money supplies slows their proliferation, it has not stopped them.
One of the tools that can be used to monitor these transactions is Blockchain. The Washington Post points out that the public ledger can be used by researchers to study the times, dates and amounts of any transaction, along with what accounts, or wallets, are involved.
While the participants’ names aren’t available, it does give the researchers an inkling of an idea of who these players are. Other than that, there is nothing that can be done to stop the members of these groups from tapping Bitcoin, just like anyone else can.
Perhaps, if regulators do become more involved in regulating the crypto space, the participants could be rooted out. In the meantime, it is a case of simply “it is what it is.”