The Blockchain Arms Race: America vs. China

March 14, 2018 Topic: Security Region: Asia Tags: ChinaPentagonMilitaryBattlefieldWarTechnology

The Blockchain Arms Race: America vs. China

Disruptive blockchain technology is coming to a gray-zone war near you.

Each of these scenarios are within the realm of possibility. If China could integrate blockchain 2.0 (and possibly quantum computing) into their security and intelligence operations, they could leverage American structures and systems against the U.S. and her allies.


Disruptive blockchain technology is coming to a gray-zone war near you. China and other foes will use Bitcoin tech against America and her allies. Defense communities in the West will need to adapt to this troubling reality that gray-zone warfare will be harder to detect and deter. Moreover, besides state threats, Bitcoin tech can make it easier for terrorist groups and violent non-state actors (e.g. criminals, proxies, etc.) to operate, since it can be used to hide large transfers of capital and allow them to communicate in an uncrackable fashion.

Fortunately, the West is slowing seeing the value in blockchain for military and intelligence purposes: the Pentagon is looking into securing databases, the American Defense Advanced Research Project Agency (DARPA) is developing a secure battlefield communication system, and Estonia has rebuilt its government around the technology. These are promising signs, but whoever weaponizes blockchain the fastest (i.e. establishing supremacy in this emerging technology), will undoubtedly achieve the sought after Monroe Doctrine in Cyber Space.

Modernizing defense systems with blockchain in the West should be a priority. However, there will also be a need to “harden” and “fortify” civil society against foreign subversion that might rely on blockchain to infiltrate and spread propaganda. Additionally, the prospect of untraceable monetary donations to influence important individuals, politics, and policies in the West, poses tremendous challenges to the workings of liberal Western democracies.

While my three blockchain examples were hypothetical, there is no evidence to suggest this has occurred yet. Unfortunately, it is entirely logical and intuitive that adversaries are working on these sorts of tactics, especially in a gray-zone war context of the twenty-first century. Hard military power appears to be exercised less by rising powers such as China, and thus far, Chinese behavior in the international community appears bent on shaping narratives, politics, and negotiations in favor of their own interests—all without firing a weapon. We will have to wait and see what the official U.S. response to this growing cyber threat as the recently passed National Defense Authorization Act (NDAA) included verbiage about blockchain for the first time ever in a NDAA, and it directed the Department of Defense to provide a briefing to Congress by May of 2018 on blockchain cyber capabilities (offensive and defensive) and how allies and adversaries are using it for security and intelligence purposes.

Jahara “Franky” Matisek is an officer and pilot in the U.S. military and is a Ph.D. Candidate in Political Science at Northwestern University. Mr. Matisek is the coordinator for the War & Society Working Group at the Buffett Institute for Global Studies and is a contributing editor at Over the Horizon: Multi-Domain Operations & Strategies. The views presented in this article are those of the author and do not necessarily represent the views of the Department of the Air Force, U.S. Department of Defense, or U.S. Government.

Image: A man holds a laptop computer as cyber code is projected on him in this illustration picture taken on May 13, 2017. Capitalizing on spying tools believed to have been developed by the U.S. National Security Agency, hackers staged a cyber assault with a self-spreading malware that has infected tens of thousands of computers in nearly 100 countries. REUTERS/Kacper Pempel/Illustration​