Experts warn Trump’s plan to deregulate crypto will help terrorists and domestic extremists

27 November 2024

President-elect Trump campaigned on being a "crpyto president," promising to open up the floodgates on cryptocurrency by undoing regulations imposed by President Joe Biden's Securities and Exchange Commission.

But according to a Wednesday report in the Guardian, crypto deregulation could provide a significant benefit to extremist groups and foreign terrorist organizations that use crypto to finance their activity. The outlet noted that neo-Nazi group The Base – which has been under FBI investigation for years — used the new development of an incoming pro-crypto administration to solicit donations via cryptocurrency on Election Day.

"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,” the message read.

“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," the group continued, posting a link to a Bitcoin wallet. “We will be fully transparent with purchases so you all see we are buying the equipment so we can train."

According to Joshua Fisher-Birch, who is an analyst at the Counter Extremism Project, crypto is extremists' preferred method of crowdfunding as any group can easily post a link to a wallet that can serve as a central destination where supporters around the world can channel funds. And while Bitcoin and Ethereum are among the most popular cryptocurrencies for mainstream investors, one of terrorist groups favorite cryptocurrencies is called Monero, due to its "untraceability."

"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," Fisher-Birch said.

Jessica Davis — a former Canadian spy who now runs a consultancy aimed at investigating terrorism financing – told the Guardian: "Any loosening of regulations on crypto (or, frankly, the appearance of loosening) is likely to further increase extremists’ use of crypto."

"“Over the last five years, there has been a steady increase in the number of terrorism cases involving cryptocurrency," she said. “Extreme right groups and actors have, in particular, been quick to adopt cryptocurrency... They do so in part to avoid scrutiny at financial institutions, but also because cryptocurrency is often hyped by far-right influencers.”

Trump was previously against crpytocurrency, calling it a "scam against the dollar." But he later flip-flopped on that position in his efforts to court campaign donations from far-right Silicon Valley tech titans. CNBC reported that a pro-Trump PAC received the equivalent of more than $7 million USD in cryptocurrency donations between June and October.

Click here to read the Guardian's report in full.

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