Summary:
Trump's presidency may lead to looser crypto regulations.
Extremist groups could exploit these regulations for financing.
The Base, a neo-Nazi group, solicited crypto donations for military training.
Privacy-focused cryptocurrencies like Monero are favored by extremists.
Biden's administration has taken a hard stance against crypto regulations.
The Return of Trump and Crypto Regulations
The return of Donald Trump to the White House is stirring expectations of a cryptocurrency-friendly presidency. His administration is anticipated to loosen regulations on this emergent technology, which has some crypto investors and enthusiasts cheering. However, this shift in policy could also open doors for far-right extremists and terrorist organizations to exploit cryptocurrencies for financing their activities.
Risks of Loosening Regulations
Jessica Davis, a former analyst at Canada’s spy agency, warns that any loosening of crypto regulations will likely increase the use of cryptocurrencies by extremists. She highlights that while integrating crypto into the traditional financial system isn't inherently evil, insufficient regulation could make it easier for terrorists to raise and move funds.
Extremists Already Leveraging Crypto
On election day, the Base, a neo-Nazi group, was soliciting cryptocurrency donations to fund paramilitary training. They publicly shared their needs for military supplies, showcasing a troubling trend of extremist groups openly using crypto for funding.
The Role of Privacy Coins
Groups like the Base are utilizing privacy-focused cryptocurrencies like Monero to evade law enforcement. The anonymity offered by crypto makes it appealing for criminal organizations and terrorist financing. Davis notes a significant rise in terrorism cases involving cryptocurrency over the past five years, particularly among extreme right groups.
A Contrast with Biden's Policies
Unlike Trump, Joe Biden has viewed cryptocurrency with suspicion, labeling it a potential national security threat. His administration has taken a hard stance on regulating crypto exchanges, aiming to enforce compliance with securities and anti-money laundering laws.
The Dark Side of Crypto
Mark Dwyer, an extremism funding investigator at the ADL, points out that the private sector has largely failed to curb extremist financing in the crypto space. Extremists are well aware of how to exploit crypto exchanges to maximize their fundraising potential, often instructing their followers on how to bypass mainstream platforms to avoid detection.
Conclusion
The anonymity and ease of creating crypto wallets make cryptocurrencies attractive for extremist groups. As Trump’s administration hints at a more lenient approach towards crypto, the implications for extremist financing could be significant. Monero has gained popularity among these groups due to its enhanced privacy features, making it a favored choice for illicit activities.
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