The World’s First ‘Crypto World War’

For better or worse, Bitcoin will define the future of global conflict in this Crypto world war.

In Ukraine, the largest European military battle since World War II is underway, and Bitcoin can influence the result. According to the Washington Post, the struggle between Russia and Ukraine is “the world’s first crypto world war,” the Washington Post, as both sides realize the benefits of borderless, permissionless money.

People worldwide have already donated millions to non-governmental organizations (NGOs) to save Ukraine from Russia’s brutal assault. The panic of conflict depletes the country’s finance, some in Ukraine resort to Bitcoin. Danish journalists have used Satoshi’s currency to buy a car and flee the country in one example. Gold might have been used to barter in a conflict zone twenty years ago; today, it’s Bitcoin.

Meanwhile, influential crypto personalities, many of whom are as wealthy as Russia’s despised billionaires, are contributing their weight to the dispute. Vitalik Buterin, the founder of Ethereum, condemned the incursion on Twitter in his native Russian. FTX gave $25 to every Ukrainian on the platform, according to Sam Bankman-Fried.

These are heartwarming tales of how cryptocurrency assists the Ukrainians, who are unquestionably the good people in this battle. Bitcoin may benefit the good guys, but it also can help the evil guys. The technology is agnostic, as many in the crypto community emphasize. The open nature of crypto, on the other hand, is a two-way street: analysts believe that Russia and its leaders will turn to crypto to avoid the economic sanctions that are piling up against them.

Also, read – As tensions between Russia and Ukraine rise, Bitcoin falls below $37,000

When states like Iran and North Korea are cut off from the global banking system, they have traditionally turned to alternative funding. And diaspora populations have always found a way to support their home country during a war. Consider the IRA, which raises funds in Boston bars, or Sri Lankan Tamils, who raise funds in Toronto temples.

What’s new and unique about crypto is how simple it is to fund such operations virtually quickly. Apart from Ukraine, the most recent example is the Canadian trucker demonstrations fueled by Bitcoin payments. Many on Crypto Twitter applauded these acts. However, many Canadian family and friends had a completely different take. As the majority of their villagers, they were enraged by a radical minority blocking the border and upset that foreign money was sponsoring most of the disruption.

The idea is that cryptocurrency has become an essential tool for funding violent and nonviolent conflict. The moral case for Ukraine is plain, but that will not always be the case. There’s a chance that the crypto community will use its wealth to engage in political or military conflicts it doesn’t understand, either out of conviction or for the sake of shitposting.

This risk is heightened because cryptocurrency is becoming increasingly politicized. Crypto used to have a few advocates in both the Democratic and Republican parties, as Coin Center’s Jerry Brito pointed out in an insightful piece. Still, the bulk of politicians was unaware of or uninterested in it. However, in today’s hyper-polarized society, cryptocurrency has become yet another partisan issue, leading individuals to create opinions based on what party leaders believe—even if they have no idea what Bitcoin is.

This risky concoction of partisanship and cryptocurrency to fund conflicts is a deadly match. Fortunately, we have some control over the former: rational people, such as those at Coin Center, can help persuade our lawmakers that cryptocurrency is first and foremost a technology that can be utilized for good or ill. Politics are irrelevant to blockchains. “Ethereum is neutral, but I am not,” Vitalik tweeted this week. The sooner people realize crypto isn’t partisan in and of itself, the better for crypto and civilization.

Although the conflict between Russia and Ukraine may be “the world’s first crypto world war,” it is far from the last. People and governments will continue to use cryptocurrency to fund conflict. Crypto is now a part of the war, just as the Internet is—consider Russia’s cyber-attacks and the Anonymous hacker collective’s recent counter-attacks.