This growing trend in information sharing and financial systems will be attributed to a new form of asymmetrical warfare. One characteristic that is important forms, and Web 3.0s stark comparison to modern distributed guerilla networks already is their form. There is no center, no nucleus. Due to this, illicit uses of Web 3.0 technology is simply the next step in warfare from decentralized groups.
Key Judgment 1:
It is highly likely that the US intelligence community will have a relatively difficult time tracking individuals who are aware of Web 3.0 technologies (blockchains) capabilities.
- The internet shifting towards decentralized mechanics means information will no longer be processed at central servers. A network of computers will likely process information in the near future.
- Web 3.0 differs from Web 2.0 in the sense that the user controls the content they create. Previously, central servers would serve as the central receiving and reviewing point for content. This means that Web 3.0 technologies reduce the power of systems currently used for surveillance and flagging of suspicious content. (Source)
- In the near future, more individuals will not be known by their given names, rather their wallet addresses. Communication will likely occur through those addresses as well. Etherscan private notes, and the invention of the ENS (Ethereum Naming Service) show evidence of this. (Source)
Key Judgment 2:
It is highly likely that foreign adversaries of the US will utilize decentralized networks to communicate, facilitate transactions, and avoid sanctions.
- Money laundering, and how adversaries interact with funds, are moving in tandem with Web 3.0 technology as a whole.
- A hearing in the House Subcommittee on Terrorism and Illicit Finance identified a funding group known as al-Sadaqah. This group was backing fundamentalist fighters in Syria as early as 2018 and were primarily receiving donations through Bitcoin. (Source)
- North Korea has been accused of funding their missile program by using cryptocurrency. (Source) Iran has also heavily incentivized cryptocurrency mining and buyback programs for Bitcoin from their central bank. (Source)
- There is high incentive for adversary countries to use this technology, as its anonymity and flexibility allow them to avert sanctions. Additionally, funds can be processed quickly and controlled by the sender and receivers.
Key Judgment 3:
It is likely that domestic terrorists will build decentralized networks and fundraising mechanics by utilizing Web 3.0 and blockchain technology.
- The new fundraising and community based mechanic called DAOs (Decentralized autonomous organizations) pose a unique challenge to the intelligence community. DAOs have proven to be able to garner funds quickly and establish their own means of transactions off past configured blockchains.
- These groups can vote on the use of funds accordingly, control the number of their members, and are free to use their own cryptocurrencies at will – for example, a group was recently able to crowdfund $3M to purchase a single edition book. (Source)
- As time grows, the decentralization of these communities may draw extremists to form their own communities utilizing these mechanics where they can anonymously raise funds and coordinate outside of traditional networks, – these groups can easily and anonymously raise that same $3.8M and use it for weapons or contraband.
- Decentralization leads to an abundance of opportunities for groups, foreign or domestic, to utilize them – and it will be challenging for the intelligence community to either increase infiltration efforts or a way to effectively identify and track suspicious transactions on every blockchain that exists.