Cryptocurrency has gained explosive adoption and significantly impacts national and international banking systems, e-commerce, and national security.
Decentralized cryptocurrencies allow straightforward peer-to-peer money exchanges online, making it wildly popular because it does not involve third parties like banks or credit card companies, thus avoiding oversight and fees.
For transactions to remain anonymous, cryptocurrency uses blockchain and encryption-enabling technologies to authenticate anonymous money transactions. In 2021, cryptocurrencies exceeded $15.8 trillion in transactions, up 567% from 2020.It is a rapidly scaling $3 trillion asset class.
An understanding of the issues and opportunities associated with the rise of cryptocurrency is mission critical. Adversaries are turning to cryptocurrency to execute their mission, making it an increasing challenge for national security leaders.
JKO recently spoke with Colonel Brian Smith of the U.S. Army Special Operations Command (USASOC) about the command's Digital Currency and National Security Executive Overview video hosted on JKO. The footage provides executive-level awareness of how cryptocurrency and blockchain function, their implications for National Security, and global adoption and usage by nations and other actors.
Cryptocurrency
What is it?
How does it work?
What is the scale? Risk?
Who are specific malign actors and nation-states?
"Raising awareness of cryptocurrency at senior levels and detailing its impact on the mission across the DoD and national security areas is essential," Smith emphasized. "Along with the challenges, there are opportunities to exploit this intelligence source."
Cryptocurrency and blockchain as an intelligence source.
US and international law enforcement agencies are using blockchain analysis to identify how hackers are laundering stolen funds in real time and working with compliant exchanges and platforms to identify opportunities to freeze or seize funds before they are sent to bad actors for nefarious purposes.
Bad actors using cryptocurrencies for funding will continue to grow and evolve as these threat actors become more sophisticated. That is why building the capacity to conduct blockchain analysis is so important to stay ahead of these evolving threats and to ensure that we are equipped to navigate the 21st-century battle space.
Cryptocurrency touches all areas of national security, and insights gained from the video can serve as additional support for counter-threat finance efforts.
Watch the SOCOM-US844-Digital Currency and National Security Executive Overview.
You must log in to JKO and enroll. 