WASHINGTON – On Dec. 8, someone simultaneously transferred 28.15 bitcoins – worth more than $ 500,000 at the time – to 22 different virtual wallets, most of them belonging to prominent right-wing organizations and personalities.
Now cryptocurrency researchers believe they have identified who made the transfer, and suspect the intent was to strengthen those far-right cases. U.S. law enforcement is investigating whether the donations were related to the Jan. 6 attack on the US Capitol.
While the motivation is difficult to prove, the transfer came just a month before the violent riot at the Capitol, which happened after President Trump invited supporters to “walk down Pennsylvania Avenue” and “take back our country” . ”
Right-wing figures and websites, including VDARE, the Daily Stormer and Nick Fuentes, received generous donations from a bitcoin account linked to the French cryptocurrency exchange, according to research done by software company Chainalysis, which maintains a repository of information for public cryptocurrency exchanges. and whose equipment assists with government, law enforcement and private sector investigations. Chainalysis investigated the donations after Yahoo News shared the data points about the transaction.
According to one source familiar with the matter, the suspicious transaction on Dec. 8, along with several other pieces of information, have prompted law enforcement and intelligence agencies in recent days to embark on an investigation to the sources of funding for the individuals who participated in the Capitol Rebellion, as well as their networks. The government hopes to prevent future attacks but also to reveal or support possible foreign participation in right-wing activities, the source said.
At a press conference on Tuesday on the Capitol riot investigation, acting U.S. Attorney Michael Sherwin said that “the scope and scale of this investigation in these cases is truly unprecedented.” At this time, Sherwin added, prosecutors are treating the issue as “a major counter-terrorism investigation or counter-attack” that includes a deeper dive into “money, travel records, disposition, movement, communications records.”
One of the ways extremist groups have made money in recent years is online through cryptocurrency and crowd-funding. Bitcoin, which was anonymously released online in 2009 as open source software, exists almost exclusively. It does not use a central bank or administrator to pay money, and no government controls or distributes it. While the value of bitcoin has fluctuated in recent years, and continues to do so, it gained mainstream popularity around 2017, the same alt-right figure Richard Spencer the same year tweets, “Bitcoin is the currency of the alt right.”
An investigation in the Washington Post in 2017 examined how right-wing groups turned even more aggressively towards bitcoin following the deadly August 2017 “Unite the Right” rally in Charlottesville, Va. The story referred to research by a nonprofit Southern Poverty Law Center that identified bitcoin’s major donation to Andrew Anglin, editor of the Daily Stormer, a prominent neo-Nazi website that accepts bitcoin donations. At the time, the donation was worth about $ 60,000.
“New expertise in messaging and online recruitment, coupled with the fact that modern extremist groups are young and digital in general, means that these organizations and individuals have fundamentally changed the way extremists rise money, ”wrote Alex Newhouse, a data analyst at the Middlebury Institute for International Studies in Monterey, in a 2019 report that examined the links between white supremacists and digital currencies.
Some prominent right-wing groups or sites prominently display their bitcoin wallets, the report noted. “The lack of regulation over Bitcoin has triggered its adoption by white supremacists,” he said.
While extremist groups and criminals have used cryptocurrency to raise money while shadowing their identities, bitcoin is a pseudonym rather than anonymous. Bitcoin wallet addresses are permanent, and a digital transaction ledger, called the blockchain, is public and cannot be changed. That means if people enter their bitcoin wallet addresses, as many right-wing groups do to raise money, transactions can be tracked, which is what allowed Chainalysis to reveal information about December’s major source of donations.
The source of the money, according to research conducted by Chainanalysis, appears to be a computer programmer based in France who created an account in 2013 – and maintained a personal blog, which was not updated between 2014 and December 9, 2020, the day after the “gifts.”
Chainalysis researchers found a blog post by the bitcoin user that reads like an apparent suicide note, bequeathing its money to “specific causes and people” in light of what it describes as “the decline of Western civilization,” though not The researchers were unable to confirm that the user had actually died. Chainalysis declined to publish the user’s name, citing privacy concerns due to the inability to confirm his death final and out of concerns about ongoing law enforcement investigations.
An email to the apparent French donor did not receive an immediate reply.
Chainalysis researchers relied on openly available information, or public bitcoin transactions, to research and map the big transaction. The original donor was registered on NameID, an internet service that allows bitcoin users to tie their online nickname or email address to their bitcoin profile – information that the original donor included. Researchers tracked that email address to the blog, and to several cryptocurrency forum posts going back to 2013.
According to their research, Fuentes, a popular right-wing commentator who was suspended from YouTube last winter for violating his hate speech policies, received the biggest piece of funding on Dec. 8 – about $ 250,000 in bitcoin. The Daily Stormer and the anti-immigration website VDARE were among the other recipients.
Yahoo News reached out to the recipients named in this article to confirm if they had received the funds, what information they had about the donor and what they planned to do with the funds. No request for comment was returned, though Fuentes did tweeting an indecent gesture, naming several journalists, including this reporter, shortly after sending the inquiry.
While the Daily Stormer website openly asks for cryptocurrency donations, it also includes a disclaimer saying it “opposes violence” and that “anyone who suggests or promotes violence in the comments section will get ban it immediately. ”
While there is no evidence that Fuentes was directly involved in the Capitol riot, something he has so far denied, the financial resources of prominent right-wing actors are increasingly interested in law enforcement.
“I would be amazed if opponents of the nation-state and terrorist organizations couldn’t figure out how to give money to these guys,” said a former FBI official who reviewed the data for Yahoo News. “Many of them use fundraising websites (often in Bitcoin) which are almost unambiguous and unambiguous. If they didn’t do it, they would be incompetent. ”
In addition, much like conversations held on social media in the weeks before the Capitol riot, the digital currency transactions take place in plain view. While cryptocurrency has the reputation of being anonymous and shady, that’s actually a common misconception, explained Maddie Kennedy, Chainalysis’s director of communications. “With the right equipment you can follow the money,” he said. “Cryptocurrency is designed to be transparent.”
Although there are methods that cryptocurrency users can use to block their identities – including using “privacy coins” such as Monero, which are difficult to track, or using a “blender” that allows various users to combine their bitcoins and their mix together to hide. their origins – there’s no indication the French programmer used those tools, Kennedy said.
Although the donations are neither a smoking gun nor a sign of crime, and it remains unclear to what extent the Capitol riot was pre-coordinated, the activity is nonetheless revealing, according to Kennedy.
“These extremist groups are probably more organized and well-funded than previously thought,” he said. Chainalysis maintains a database of “domestic extremists” who hold cryptocurrency accounts, and although the company has tracked donations to right-wing groups over the years, the December deposit was “the largest single month we have ever seen” directed towards the these cases, the researchers wrote.
“This is evidence to show that they are raising money,” said Kennedy. In addition, the fact that the donor is outside the United States suggests “this has international scope,” he continued, a fact that “law enforcement should be paying attention to.”
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