A Coin for the Tsar: The Two Disruptive Sides of Cryptocurrency

Abstract

Vladimir Putin is getting the Kremlin into the cryptocurrency business, and the United States should be worried: The West is still reeling from the last time Russia delved into disruptive social technology. For kleptocrats and non-state groups alike, cryptocurrencies—like Bitcoin— provide a means to “commit the oldest sins in the newest ways;” what’s more, an adversary state can scale up these novel advantages to further disrupt the contemporary security environment.[i] However, cryptocurrencies also offer a host of benefits to entrepreneurial individuals and innovative economies. Acting to influence the cryptocurrency ecosystem can be a decisive option for national competition below the threshold of war, whereas not acting magnifies the asymmetric advantage these technologies provide to our adversaries, particularly Russia. This paper examines the evolving power of cryptocurrency, describes threat behaviors enabled by the technology, and recommends some ways to counter threat activity in this nascent digital economic environment while preserving the possibilities for healthy innovation.