Putin is Embracing Blockchain
The crypto community shouldn't play along
While the West plays catchup with the Kremlin’s use of the internet to disrupt elections, the Kremlin has moved on to weaponzing a much newer technology: blockchain.
Where the internet disrupted the flow of information and undermined mainstream media outlets, blockchain technology is doing the same to flows of liquid capital and banks. According to a new indictment by Mueller the 2016 US election hacking was funded by freshly mined Bitcoin and a recent New York Times article quoted an FSB agent, representing Russia at a blockchain event in Tokyo saying:
“The internet belonged to America. The blockchain will belong to the Russians.”
Back in March Time Magazine revealed it was Russia who masterminded the ‘Petro’, Venezuela’s attempt to circumvent US sanctions with an oil backed cryptocurrency. This was the first concrete example of Russia using the blockchain as a weapon against the west. What Time didn’t mention about the Petro was it is based on Ethereum and its creator, Vitalik Buterin, is working with Kremlin owned bank VEB. While Twitter, Facebook and Google are scrutinized for enabling their services to be weaponised by Russia by not doing enough to prevent it, leaders in blockchain technology are getting a pass, even when directly working with the Russian government.
In June 2017, Vitalik Buterin spoke directly with Vladamir Putin at a conference in Moscow. Kremlin Press Secretary Dmitry Peskov, said of the meeting “Putin and Buterin discussed the application of technologies in the country. And that Putin supported the idea of establishing new business relationships following the road paved by Blockchain technology.” Time quoted a Russian state owned bank executive, who was at the event, saying “This is how the whole thing started”, regarding the Petro project.
Months later in August Vitalik had created his first for-profit Ethereum venture ‘Ethereum Russia’ with Russian state owned bank VEB, Vitalik attended a signing ceremony for the partnership with its head Sergei Gorkov. The New York Times has said VEB “is intertwined with Russian intelligence. And the Russian prime minister is, by law, the chairman of its supervisory board.” The FBI previously probed a meeting between Jared Kushner and Sergei Gorkov after the 2016 presidential election.
There is nothing to suggest Buterin had any direct roll in the creation of the Petro, but he clearly indirectly catalysed its creation when meeting Putin and his proceeding work for a Kremlin owned bank. Buterin has lent his mind to the Russian government, who are diligently weaponizing his technology against the west, making Vitalik a kind of useful genius. Vitalik in person (I met him once) and online is open, transparent and intellectually honest. I have no doubt his ‘Ethereum Russia’ venture has good intentions, after all how could the transparency and absolute truth of blockchain technology be a net negative in a dictatorship?
However, Russia is already using blockchain technology to create the illusion of a free and open democracy, the use of blockchain technology in voting for pre-approved candidates has already begun. Now with the Petro Russia has taken aim at Western sanctions. Most recently Gazprombank has announced it will allow large private clients to buy and sell cryptocurrencies, a service no doubt intended for Putin’s oligarchy and their wealthy underlings. We also now know bitcoin funded the 2016 election hacking.
Since Satoshi is anonymous, Vitalik has become the poster child of the blockchain revolution, he is to the blockchain what Mark Zuckerberg is to social networks. If Zuckerberg is going to be held to account for not doing more to stop Russia using his platform to attack the West, Vitalik should be held to account for working directly with the Kremlin. Some will argue it is diplomatic, a kind of ‘crypto-diplomacy’, but at this point Vitalik is more Dennis Rodman with a basketball than Richard Nixon with a Ping Pong paddle.
