Crypto is playing an increasingly significant role in funding online disinformation campaigns aimed at influencing elections, according to a new report from blockchain analytics firm Chainalysis.

Chainalysis dug into how bad actors are using digital coins to fund their operations. What they found paints a picture of a growing problem that could affect how people see election information online.

How crypto ‘donations’ keep disinformation outlets running

Some websites known for spreading false information are asking for crypto donations.

The report details how spreaders of disinformation are using crypto to accept donations and fund their activities. One example is SouthFront, a Russia-based outlet sanctioned by the US Treasury Department in 2021 for spreading disinformation around the 2020 election.

The report found that one person sent them $2,700 worth of crypto. But it’s not just one-off donations. The report also highlights how some donors support multiple disinformation campaigns. In one instance, a single donor sent Bitcoin to SouthFront as well as to a suspected extremist group with ties to known extremist donors.

“Crypto is a tool like any other that’s used to support these influence operations globally,” said Valerie Kennedy, director of investigations at Chainalysis.

She adds that there are now “more options available on the clear and dark web to make it easier to run these types of operations.”

Millions in crypto spent on shady services

It’s not just direct donations, the report suggests. The people spreading lies also use crypto to pay for services that help them reach more people online.

For example, they buy fake social media accounts and phone numbers to make it look like real people are sharing their false stories. One service that sells phone numbers handled $7.7 million in Bitcoin, the report found. That’s a lot of fake phone numbers!

There are also websites that host content without asking many questions. One such site, which accepts Bitcoin payments, was used to leak emails stolen from Hillary Clinton’s campaign in 2016. These sites make it easier for fake news spreaders to keep their content online.

Another concerning trend is the use of “bot farms.” These are services that sell stolen or fake social media accounts in bulk. One called Ubar Store claims to have filled over 10,000 orders and takes crypto as payment. With lots of fake accounts, it’s easier to make lies look popular online.

Why this matters for the 2024 election

As the US gets ready for another big election, these findings show how crypto is becoming a go-to tool for people who want to spread false information. What’s more, crypto has become a “wedge issue” that has divided the community.

It’s hard to say exactly how much crypto is being used for this, but Chainalysis claims says it plays a “significant role” based on what they’ve seen. The fact that crypto can be sent around the world easily and somewhat anonymously makes it attractive for these kinds of operations.

Recent events, like the attempted attack on former President Donald Trump, have already sparked a lot of conspiracy theories. As we get closer to the election, keeping an eye on how crypto is used to spread lies will be crucial.

For voters, this means being extra careful about what they see online. Just because a story seems popular doesn’t mean it’s true. For lawmakers and tech companies, it’s a reminder that they need to think about how crypto fits into the fight against election misinformation.

Credit: Crypto Briefing