Cryptocurrencies are often stereotyped as illicit assets used by criminals, but it can also expose malign interference efforts.
From Trump’s recent assassination attempt to President Biden’s latest dropping out of the US presidential elections, the whole world seems to be holding its breath as the United States presidential campaigns continue with its reality television-like developments of twists and turns.
However, political elections could also be an opportunity for external actors to influence the outcome of voting decisions, be it through malign interference or disinformation campaigns.
While the web of disinformation campaigns can be hard to track, the latest report by blockchain analytics company Chainalysis, Malign Interference and Crypto, highlights how cryptocurrencies could be a key component in uncovering such clandestine intelligence operations from malicious actors.
What are Malign Interferences?
First off, what constitutes malign interference? According to the US Cybersecurity and Infrastructure Security Agency (CISA), the term is defined as “malign actions taken by foreign governments or foreign actors designed to sow discord, manipulate public discourse, discredit the electoral system, bias the development of policy, or disrupt markets for the purpose of undermining the interests of the United States and its allies.”
While the definition here emphasises the United States of America, the same definition could apply to similar actions taken against a sovereign state. Bringing the definition closer to home in Southeast Asia, the framework proposed by the S Rajaratnam School of International Studies (RSIS) policy report, ‘Cases of Foreign Interference in Asia’, defines the term as acts of hostile information campaigns, which includes:
- Covert funding of political parties, officials, people of influence, education institutions, or activists, to affect said sovereign state.
- Cyberattacks, hacks, and information leaks.
- Spreading biased or dishonest information, normally via automated bots to accelerate the process.
Such malign interferences are often assumed to be undertaken by external groups not belonging to the targeted state, to sway or disrupt its internal policies.
Examples of Malign Interference
Any sovereign state is susceptible to hostile interferences from other groups or states, but in the interest of relevance to Chainalysis’ report, we will be focusing on active interferences taken against the United States in this article.
One such publicly available document that points out such malign interferences is the “Final Report of the Select Committee to Investigate the January 6th Attack on the United States Capitol”, which pertains to the attempted attack on the US Capitol back in 2021 by its citizens.
The report singles out Russia as a key player in providing malign disinformation to US audiences, mentioning Kremlin-linked influence organisation such as Project Lakhta, which the report points out as having amplified controversial domestic issues using social media personas, news websites, and US persons to deliver the content.
Similarly, the report also points out that proxies were also heavily utilised by Russian intelligence to push influence narratives to US media organisations and officials alike. But the document also admits that linking the proxies to evidence of foreign sponsorship is a difficult task.
That is where cryptocurrencies come in. While both fiat currencies and cryptocurrencies are used to finance clandestine campaigns, the latter can be tracked more easily, thanks to the immutable nature of crypto transactions plus its ease of tracking on blockchain networks.
In their latest report, Malign Interference and Crypto, Chainalysis used investigative tools to track the movements of funds on the blockchain to uncover the following disinformation or malign interference campaigns.
SouthFront’s Disinformation Platform
Russia-based disinformation media outlet, SouthFront, is designed to appeal to military enthusiasts, veterans, and conspiracy theorists, and uses social media extensively to spread misinformation.
The organisation mainly solicits crypto donations to fund its operations, with its website providing detailed instructions for its supporters to send funds. It also recommends donors send funds directly from personal wallets, either hot or cold, while avoiding third-party platforms.
Iran-Linked Islamic World News (ISWN)
The Islamic World News (ISWN) is another media outlet affiliated with the Iranian Revolutionary Guards and often conducts pro-Iranian government and military propaganda campaigns.
A quick look at blockchain on-chain movements unveils that ISWN has ties to Southfront, with the former even listing the latter as a partner on its YouTube channel.
Disinformation from Russian Paramilitary Groups
Russia’s invasion of Ukraine has also brought pro-Russian paramilitary groups into the spotlight. These groups focus on sharing pro-Russian information that seeks to undermine Ukraine’s efforts, with some openly soliciting cryptocurrency donations to fund the purchase of weapons and combat accessories.
How Does Crypto Uncover Malign Interference Efforts
Such hostile intelligence groups collect donations through crypto transactions from donors in a bid to circumvent imposed sanctions, thanks to the mistaken belief that the digital asset is anonymous and untraceable.
This mistaken fallacy means that anyone can monitor the wallets used by these malicious actors and their fund movements, making crypto transactions a key factor in uncovering the links between such groups.
By monitoring their on-chain transactions, analytical platforms can determine the transaction amounts, frequency, and even the relations between groups based on the movement of funds between wallets.
SouthFront
According to the Chainalysis report, the organisation has received over $27K in crypto payments, the bulk of which were in Bitcoin. Since then, SouthFront has continued to solicit crypto donations while cashing them out at sanctioned exchanges such as the Russian-based Garantex.
Islamic World News
ISWN solicits donations in cryptocurrencies like BTC, BCH, ETH, XRP, DOGE, SOL, TRX, and SHIB. By analysing the funds ISWN received via its Bitcoin address advertised on its YouTube channel, it uncovered on-chain connections between SouthFront and ISWN. An Iranian service and suspected Iranian mining service also sent around $26K in Bitcoin to a mainstream exchange to convert the funds to fiat currency.
Russian Paramilitary Groups
According to the report, donors to these paramilitary groups also often donated to the other two groups mentioned above. A military donor sent $19K in Bitcoin to pro-Russian journalists and another $24.6K across four other pro-Russian groups, while another sent Bitcoin to multiple extremist causes, including SouthFront.
Cryptocurrencies Are Important in Fighting Malign Interference
While malign interferences and covert intelligence continue to occur on a daily basis, the immutability of cryptocurrencies has greatly helped uncover what goes on behind the scenes.
While the digital asset will undoubtedly be used for further illicit activities, it is a double-edged sword for such organisations as they make it easier for enforcement efforts to track these operations down.
Read the full report by Chainalysis.
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