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The Video Game Industry Is Growing: Here Are 4 Ways Brands Are Reaching Gamers
And, with the growth of live streaming, mobile gaming, AR, and VR, this number could get even bigger.
While Twitch.tv, the leading live-streaming platform, hosts millions of users that air video feeds of themselves gaming, many smartphone users also find themselves tapping into multiple mobile games per day.
Right now, it seems like there’s a video game or gaming platform for everyone. And as many of these games and game systems are beginning to use emerging technology, marketers are getting even more aggressive in this space.
Although big companies are looking at in-game marketing tactics more than ever, the interest in reaching gamers actually isn’t that new. In fact, video game marketing precedes some of today’s most popular video game consoles. While brand awareness strategies have evolved in this space, they’ve nearly always been there.
On top of the opportunities that emerging media might offer marketers in the video game industry, gaming audiences also mirror target audiences of many consumer-facing brands. This means video gaming platforms could be a great place for brands to connect with their target audiences.
Gamers are primarily millennials, evenly split in gender, and have aged with the gaming industry. While they were children when the earliest, less-sophisticated games came out, millennials have become very tech-savvy and have embraced today’s more innovative gaming platforms.
Because of their age, millennials also able to make both big and small purchasing decisions in their households. At this point in their lives, millennials can buy or lease a wide range of products, from soft drinks to mobile devices, to cars. This is one reason why marketers zone in on mediums where this age group is prevalent, such as the gaming space.
Along with newer gaming content, millennials also respond well to games that make them feel nostalgic. One example of this was the successful release of the Nintendo Switch, a game system modeled after the 1980s Nintendo. Within 21 months of its launch, 8.7 million Switch units were sold — making it the fastest-selling gaming console of all time.
As marketers read about the possible opportunities associated with video game marketing, they might wonder how brands are actually using this medium to promote products. They also might be asking, “Is this strategy even accessible to me?”
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In this post, I’ll discuss the evolution of video game marketing, show a few examples of how brands are innovating in the space today, and note some tactics that marketers might want to consider if gaming does become more accessible in the far-term.
While in-game promotion probably won’t be viable for most brands in the short-term, another new platform, such as a viral social media site, might inspire you to get creative with your marketing techniques. Even if marketers can’t replicate the strategies below today, they can still use the campaigns as examples of how companies thought outside the box to engage audiences on a new or emerging platform.
To give some added perspective on how much the gaming industry has changed, I’ll start by noting some of the earliest video game marketing examples.
A Brief History of Video Game Marketing
In the early 1990s and 2000s, big brands zoned in on young gamers by creating branded video games. Two memorable companies that did this were Chex Mix and Burger King.
Chex Mix’s Chex Quest (1996)
In 1996, as children were starting to play video games on their parents’ PCs, Chex decided to engage its young audiences by placing a CD-ROM game called Chex Quest at the bottom of Chex Mix boxes.
In the intergalactic game, players controlled a space hero called “Chex Man” as he fought off green aliens who would cover their enemies with goo. The game featured multiple levels of difficulty and challenges, including an alien-filled maze. To maintain Chex Man’s strength and health when fighting off aliens, players needed to search for and direct him to foods like fruits and boxes of Chex Mix.
On a deeper level, the game told a commercial-like story of how heroes and astronauts are fueled by healthy breakfasts, like Chex Mix. This game was not only creative, but it also won many prominent advertising awards. In 1996, the video game won a Golden Effie for Advertising Effectiveness. It also won the Golden Reggie Award for Promotional Advertisement in 1998.
Burger King’s Branded Games (2006)
Ten years after Chex Quest, Burger King also identified that its audiences enjoyed gaming. In 2006, the restaurant chain began its first foray into the game world by including one of three branded Xbox games — PocketBike Racer, Sneak King, or Big Bumpin’ — in value meals. Customers could also buy the games for $3.99 each.
Each branded game, or advergame, featured the Burger King mascot along with a burger-related theme. Essentially, all of the games, which were created by the ad agency Crispin Porter & Bogusky, were like interactive advertisements that entertained players and reminded them of Burger King.
For example, in Sneak King, players would step into the role of “The King,” who looks like Burger King’s mascot. Gamers then had to deliver Burger King meals to other characters. While the game entertained players, it also highlighted Burger King’s menu options and brand in great detail, similarly to a commercial.
Within the first weeks of Sneak King’s launch, approximately 2.7 million copies of the advergame were sold, making the campaign an ROI success and a win for Crispin Porter & Bogusky. The campaign also won a Clio Award after Burger King claimed it lifted the chain’s overall sales.
Here’s a trailer for Sneak King:
The Current State of Ads in Gaming
Games and consoles have changed drastically since Chex Quest and Sneak King. Not only do video games look more visually stunning, but many online games and Wi-Fi-powered consoles connect players and strangers from all around the world.
As the gaming space has evolved, so has video game marketing. While reaching gamers used to require marketers to create an entire branded video game, big brands are now able to re-work traditional strategies, like influencer marketing, product placement, and native advertising to fit into the gaming space.
Common Video Game Marketing Strategies
- Twitch Streaming
- Gamer Sponsorships
- Product Placement
- Mobile Ads
Twitch.tv, which was purchased by Amazon in 2020 and now has over 15 million daily active users, allows people to air a picture-and-picture stream of their computer or game console screen along with a webcam video of themselves.
If a person’s Twitch profile gets a large number of views and subscribers, they can apply to be verified as a Twitch Partner. Once they’re verified, Twitch will give them a small percentage of its advertisement revenue based on their stream’s views and the account’s subscriber counts.
Because of this picture-and-picture format, Twitch quickly became thought of as the social platform for gamers. Since this platform launched, normal people have earned major revenue and gained a huge online following just by streaming themselves playing popular video games.
When it comes to marketing on Twitch, there are two major options: One is to advertise and the other involves starting or sponsoring a stream.
While Twitch has been growing its advertising program since being purchased by Amazon, it recently began asking advertisers to commit upwards of $50,000 in ad spend per campaign. While Digiday reports that Twitch reps seem confident about advertising ROI, this is definitely a hefty cost for most companies.
Because advertising is quite expensive on Twitch, many brands have experimented with starting their own streams. Here are just three notable examples:
Wendy’s first Twitch stream, which won a Gold Clio, followed an avatar dressed as Wendy who appeared on the online battle game, Fortnite.
At one point in Fortnite’s online storyline, players were prompted to hunt cattle and transport beef to freezers at nearby restaurants. Once they did this, the players would earn coins.
When the Wendy’s team heard that Fortnite players were being encouraged to put beef in freezers, the chain tasked its marketing agency, VMLY&R, in creating an avatar that looked like Wendy. Wendy’s and its marketing firm then launched a Twitch stream where the avatar began to break into restaurants and destroy freezers:
Like a commercial, native ad, or advergame, the goal of the campaign — aside from engaging new audiences — was to remind Twitch audiences that Wendy’s makes an effort to serve the freshest, best tasting beef to its customers.
During the stream, mentions of Wendy’s on social media went up by 119%. The stream was also viewed for a total of 1.52 million minutes with a quarter of a million viewers.
The campaign also allowed Wendy’s fans to interact with her avatar and the stream, which led other Fortnite players to start smashing freezers as well. Viewers of Wendy’s stream also began tweeting about it or posting in the feed’s comment thread. Because of engagement like this, it made Wendy’s company values, brand, and live stream incredibly memorable to gaming audiences.
This campaign led Wendy’s and VMLY&R to win gold medals at the Clio Awards and the Cannes Lions International Festival of Creativity.
According to one Cannes Lions Jury Chair PJ Pereira, the creativeness of this campaign might have opened the door for new marketing opportunities in the future.
“[Making Fortnite Fresher] was setting up a new trend instead of being the apex of a previous trend,” Pereira told Ad Age.
By hosting a nine-hour Twitch stream that followed its mascot playing Fortnite, Wendy’s interacted with gamers in a unique new way.
In 2020, Old Spice launched a stream that followed a dopey avatar named Nature Man who was “contractually obligated” to do what Twitch viewers told him to do as he walked around a computer-generated forest. As Twitch viewers commented with commands for the avatar, an Old Spice rep that was controlling him would make him fulfill these tasks.
At certain points of the Old Spice event, viewers told Nature Man to do things like chop down trees, fight multiple bears, and eat random birthday cakes. Here’s a quick highlight reel:
Although Old Spice’s live stream wasn’t directly about its products, it was still very in line with the brand’s 2020 commercials, which argued that its body spray “smelled as good as nature.”
In and before 2020, live streaming was still very experimental. But, like Wendy’s, Old Spice identified that many young male audiences were gaming on Twitch and decided to create an experimental campaign to engage them. This strategy seemed to work, as the stream received 2.6 million total views.
During a campaign called, “Live Free, Couch Hard,” Totino’s partnered with Twitch influencers to market its pizza rolls through various Twitch streams. In one of the Totino’s streams, which was produced with the help of its marketing firm, 72andSunny, a handful of Twitch stars with millions of subscribers tried to play video games on a couch that moved around like a bucking mechanical bull machine.
During Totino’s stream, viewers could watch the influencers attempt to play video games while also commenting to say which direction the mechanical couch should move next. Viewers could also comment with an emoji that looked like a pizza roll face created just for the event.
Here’s a highlight reel that one of the influencers posted on their stream after the event:
According to a post from Jason Donaldson, a senior writer for 72andSunny, the stream was watched for a total of 1.8 million minutes and it was the number one trending discussion topic on Reddit during the event.
Technically, the focus of Totino’s stream was on the notable gamers riding a mechanical couch, rather than on playing one specific game. However, the food company does a great job of identifying alternative content that gamers will still watch and subscribe to — even if they aren’t getting specific game tips.
For years, brands have embraced influencer marketing on various social platforms and in many media campaigns. In sports, you might see an athlete wearing running sneakers from a shoe company. In the makeup industry, you might see a vlogger giving a sponsored tutorial for a new lipstick. Now, as gaming has gotten more interconnected and social, influencer marketing is also starting to thrive in the video game industry.
As online gamers grow a following, brands now seek them out for endorsements or sponsored content. Here are a few examples:
Xfinity Comcast Sponsors Evil Geniuses
Along with sponsoring single gamers, big brands have also sponsored a number of online gaming teams.
Many of these teams successfully compete in ESports, a gaming category that includes online sports, competitions, or battle-oriented games.
In many major ESports games, players can compete individually or join a team. As they get better at a game, their game ranking amongst other online players will go up. Those who gain high rankings on ESports games often get recruited to better-performing teams or can even get sponsored by brands, similarly to real-life athletes.
Since 2020, Xfinity Comcast has sponsored an ESports league called Evil Geniuses. This league, which is now incorporated as its own company, is made up of top-performing gamers who’ve gained expertise and high rankings in ESports games like Call of Duty, Halo, Starcraft, and Rocket League.
As part of the sponsorship, the Evil Geniuses, which has a major gaming industry following, received a decked out Xfinity Comcast gaming studio. The Xfinity logo has also been placed on Evil Geniuses’ official website and added to uniforms that players wear on Twitch streams or at gaming events.
Evil Genius’s Twitter account also regularly mentions Xfinity or the sponsored gaming studio on its social media accounts.
Coca-Cola Sponsors Alex Hunter
For over 20 years, thousands of people around the world have been playing EA Sports’ FIFA World Cup video game series. The ESport game series releases a new World Cup game every year, which allows people to virtually play soccer with others around the world. Like other ESports games, players that get great scores will rise up in online rankings and might gain a following from fellow gamers.
Recently, a highly-ranked player from the 2020 FIFA video game, Alex Hunter, got sponsored by Coca-Cola. As part of his sponsorship, Hunter endorses Coca-Cola at real-life gaming events and dresses his avatar in all red. Hunter’s avatar was also featured in a Coca-Cola commercial where a child’s avatar offers him a Coke before he goes to play a virtual soccer game.
McDonald’s Products in Splatoon 2: Splashfest
Splatoon 2: Splashfest, a Nintendo Switch game created for all ages, opens by giving gamers a choice between two items, such as ice cream or cake. Each of the items that gamers can choose from has a hard color background. At the beginning of each game, users lock in the choice they want to make and get a paintball gun filled with paint that matches the background color of the item they chose.
In the recent Japanese release of Splatoon 2: Splashfest, there was a blatantly obvious product placement from McDonald’s. Gamers were asked to start the game by choosing between McDonald’s Chicken McNuggets or French Fries. The McNuggets were associated with red paint and the French Fries were associated with purple.
Here’s a quick video (in Japanese) where the hosts discuss which item they think is better to ramp up players before they make their choice.
During the game, 71% of those players joined the French Fry team, but the Nugget team surprisingly covered the field with more paint. It’s not clear how many people were playing the game, however Splatoon 2 sold over 2 million copies by 2020.
This is a great example of a product placement because it feels natural to players and allows them to think about and weigh the differences between two main products rather than just one.
Mobile Gaming Ads
Outside of PC or console-based video game marketing, brands are also putting major advertising dollars into mobile game ads.
While most people might think that mobile gamers find ads annoying because they block the entire game, research shows that mobile game players are actually more receptive to ads than users of other mobile apps.
When I heard about this, I was pretty surprised myself. So, I conducted a quick survey using Lucid software to see if people were actually interacting with ads.
Out of a sample of 265 people, 70% said they’d tapped on an ad in a mobile phone game before.
This Survey was conducted with Lucid Software
Right now, there are a few major ad strategies related to mobile games. One is a standard native ad that links to a business’s website. Another is an interactive ad that lets viewers tap and interact with the content in some way. Lastly, big brands like Starbucks are also beginning to experiment with location-based ads in AR games.
Here are a few examples of mobile game ad types that you might regularly see:
Interactive Mobile Ads
While Disney makes a host of mobile games related to their films, they have also invested millions of dollars into mobile game advertising. In one ad, which they launched to promote the film, “Pirates of the Caribbean: Dead Men Tell No Tales,” viewers were prompted to look for and tap a series of items as they watched the film’s trailer. Tapping on the ad sent them to more video-based content.
While the ad is no longer available to view online, AdColony’s Jude O’Connor described the interactive storyline in a post from The Drum,
“During the trailer, the user was prompted to play a search game and find objects within the trailer itself, tap the screen and it was almost like a playable ad experience,” said O’Connor. “Then, when they were able to find additional pieces it unlocked new content, additional trailers for them, character content at the end of the video. The user then became part of the experience.”
AdColony, the agency which created the ad for Disney, does not specify results related to the ad, but has noted that it was a success. Here’s a Creative Showcase piece where the company goes into detail about what might have made the ad so effective.
Disney’s interactive mobile game ad strategy is smart because those playing video games want to be interactively entertained. While a standard ad might bore them, something interactive might interest them while in a gaming mindset.
Apple runs ads for Apple Music on a number of smartphone and tablet games. This ad is pretty simple and shows mobile gamers the Apple Music logo, an animated music symbol, and a description of the service that says, “Enjoy over 50 million songs. Always ad-free.” At the bottom of the ad is a CTA that says “Listen on” followed by Apple Music’s Apple Store Icon. Users can tap on the ad to be directed to Apple Music’s app store page,
Like many effective mobile ads, Apple’s design simply explains exactly what the service its selling does without overwhelming mobile viewers with too many words or visuals.
Tully, a financial advising and savings app and service, launched a simple and semi-interactive ad for mobile games. In the ad, you can swipe left to see the benefits of using Tully and screenshots of how the app works. At the bottom, you see a quick description of what the app does, it’s five-star App Store rating and a CTA button that says “Download.”
Tully’s mobile game ad is an example of how an ad can be simple but still interactive. Even though this ad probably didn’t take as much time to design as a more intricate interactive ad, it still allows the viewer to engage with it by swiping through different pages of it to learn more.
Augmented Reality Ads
As video games like Pokémon Go combine AR and geo-location to create a new style of mobile gaming experience, brands have also experimented with AR in-game ads. To date, a great example of this was Starbucks — which sponsored Pokémon Go locations.
In 2020, when Pokémon Go was going viral, the coffee chain teamed up with the game’s developers to mark 7,800 of its physical locations into Gyms or PokéStops on the AR map. When players entered a Starbucks Gym or PokéStop, they saw an ad for a limited-edition Pokémon Frappuccino.
Although Starbucks did offer a more traditional in-game beverage ad to players who arrived at its Gyms and PokéStops, the chain more importantly pulled in significant foot traffic from gamers before even revealing the beverage in the Go app.
By sponsoring Pokémon Go locations, Starbucks creatively leveraged an AR platform to entertain its customers and pull new audiences into its physical store.
Navigating Gaming and Emerging Mediums
While marketers shouldn’t just shift all of their resources to start their own version of Chex Quest, it can’t hurt to keep up with new mediums that might provide opportunities in the far future. While gaming might not be one of them, a new social media platform might be a great place to experiment with interactive content or other strategies that engage new audiences.
The examples above demonstrate how brands identified their audiences, learned about the platforms they were using and aimed to meet them on those platforms. As media continues to evolve, marketers at all company sizes will want to keep thinking of new strategies that will meet their prospects where they are — even if those audiences are on a somewhat newer platform.
Originally published Oct 21, 2020 7:00:00 AM, updated November 19 2020
What should I be aware of before investing in crypto-currencies?
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I’m not an expert but I’ve been into this market since the beginning of 2020. I can tell you my observations.
It’s good to have an experience, but it’s of course a matter of time. Before you start, do some research, look for a cryptocurrency which is the best to you. Take some time and keep trading before you decide to invest in. Find interesting possibilities to you, make up your mind if you want to mine your coins or not, ask your friends what do they know about that market (maybe you know some crypto – geeks).
The most important is security. Invest in some hardware wallet. Also a good opti.
12 Facts About Bitcoin You Were Probably Not Aware Of
December 8, 2020
2020 was the year that the digital currency bitcoin officially became mainstream. Thanks to its impressive price rally throughout the year, which was extensively covered by global media, most people will have at least heard of bitcoin at this point in time. However, there are things about bitcoin that not everyone knows about. In this article, you will discover 12 facts about bitcoin that you were probably not aware of.
1. The Inventor of Bitcoin is Unknown
“Satoshi Nakamoto” is the pseudonym that was used by bitcoin’s creator(s). The mysterious identity of the bitcoin creator(s) has led to a lot of speculation but no conclusive evidence of the identity has yet been published.
“Satoshi Nakamoto” is currently worth about $13 billion and is a nominee for a Nobel Prize in Economic Sciences. He last made a public post in 2020.
2. No One Actually Controls Bitcoin
Bitcoin is not owned by any government or central bank and thereby gives its users the freedom to be their own bank. However, governments can declare the use of bitcoins illegal like countries such as Ecuador and Bangladesh have done. As a matter of fact, anyone caught using bitcoins in Bangladesh can earn themselves time in prison.
In light of this fact, some countries might ban bitcoin but users can still go about and buy and sell the digital currency regardless as governments cannot stop the decentralised peer-to-peer network that bitcoin is built on.
3. Bitcoin Has a Limited Supply
There can only ever be 21 million bitcoins in circulation thanks to the way that bitcoin has been coded. The 21 million coin limit will be reached at around 2140. Currently, there are around 16,725,000 million bitcoins in circulation.
This limited total supply is one of the reasons why bitcoin has increased in value so much as it is a scarce asset.
4. There are over 20,000 Bitcoin Millionaires
According to Bitcoin Rich List, there are over 20,000 bitcoin millionaires. In fact, some millionaires have turned into billionaires. According to CNBC, Cameron and Tyler Winklevoss have become the first bitcoin billionaires thanks to the recent surge in the bitcoin price.
5. Bitcoin is Actually Highly Transparent
The media often claim that bitcoin is anonymous but that is far from true. Bitcoin transactions can actually be very transparent.
“If I have all my bitcoins in a single address and keep reusing it, everyone I ever interact with can follow everything I do. This makes bitcoin the most transparent money system ever created,” said Marco Carnut, founder of CoinWISE, highlighting how transparent the bitcoin system can be when it is being used in a particular way.
6. Supercomputers Have Nothing on The Bitcoin Network
500 supercomputers combined are less powerful than the bitcoin network. Presently, the bitcoin network has a hash rate of over 14,867,776 TH/s, which is way more than the world’s most powerful supercomputer.
7. The Bitcoin Network Uses More Energy Than Most African Countries
A report compiled by UK-based energy comparison platform, Power Compare, states that the power consumption from bitcoin mining is currently estimated at over 30 TWh per annum, which is more than that of 159 individual nations in Europe, Africa, and America.
In fact, only Algeria, Egypt and South Africa use up more power than the bitcoin blockchain.
8. Bitcoin Transactions Cannot Be Easily Refunded
Your bitcoin wallet is so precious that if you lose it, you could lose your coins forever (unless you have backed up your wallet!). What’s more, bitcoin transactions are non-refundable so if you make a mistake about the amount or the recipient wallet address that money is likely gone forever. Unless, of course, your counterpart is so friendly as to refund you the amount.
9. You Can Live Solely on Bitcoin
Austin Craig and Beccy Bingham created a documentary called “life on bitcoin” to prove the statement: “man can live on bitcoins alone.”
The documentary illustrates that a married couple can actually live on bitcoin for 90 days.
10. The FBI Was a Major Bitcoin Holder
The FBI once possessed around 1.5 percent of the world’s bitcoins. After shutting down the dark web marketplace Silk Road in 2020, the FBI confiscated 144,000 bitcoins, which were later auctioned. The US government made $48 million from the auction. Unfortunately, its shutdown did not prevent more black markets from cropping up. Google search results depict the existence of a Silk Road 3.1.
11. Several Major Corporations Accept Bitcoin Payments
You can make payments in bitcoins to companies such as Dell, Microsoft, and Overstock. That means that you can pay for laptops, hotels, and throw pillows with bitcoin.
12. The Early-Bird Advantage
If you had invested $100 worth of bitcoins in 2020, you would be a bitcoin millionaire in 2020. For example, Barry Silbert, the founder of Digital Currency Group, bought 48,000 bitcoins from the Silk Road auction in 2020.
At that time, one bitcoin was worth $350. In 2020, Silbert’s investment has increased over 16 times and has made him a very wealthy man.
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How Often Is Crypto Really Used In Illegal Activity?
Statistics, examples, and ways to legally use cryptocurrency
October 1, 2020, was a turbulent day for San Francisco Public Library. A dozen FBI agents pretending to be usual visitors surrounded a man sitting at one of the tables, took his laptop and put a pair of handcuffs on his hands. That man was Ross Ulbricht, founder of Silk Road – the largest darknet marketplace for drug dealers, killers, and other criminals. The seizure of Ulbricht was supposed to tackle the illegal online trade, but, as the news site DeepDotWeb wrote , the bust was “the best advertising the darknet markets could have hoped for”. The reputation of cryptocurrency also suffers from associations with terrorists, who sometimes use it for their needs. How big is the real scale of the problem? And how many legal ways to use crypto exist? ChangeNOW has dived into the topic – and suggests you an overview of the current state of the problem.
- The drugs trade volume using cryptocurrency is relatively large
- Crypto was a significant reason why a part of drug sales migrated to the web, though stays yet not viable and anonymous enough for dealers (same as for terrorists)
- As efficient use of blockchain technology requires good infrastructure, crypto remains not suitable enough for many terrorist groups
- However, some terrorists are trying to adjust to anonymity threats and hold fundraising in crypto
- Legal ways to use cryptocurrency include dozens and vary from IT services to car rentals
Crypto & Drugs & Rock’n’Roll
The total volume of the online drug market using cryptocurrency is around $1 billion. It is located in the darknet, which provides an attractive, profitable, and mostly secure environment for drug dealers. Cryptocurrency, in turn, allows making payments that are hard to be tracked by authorities. This is how blockchain technology has helped to bring a big part of drug sales online from the streets. And it’s not only about drugs themselves – many legal opioid drugs are illegally sold here, too.
However, cryptocurrency is not always as secure and anonymous as it is thought to be. The information about any transaction ever made stays forever in the blockchain, which makes the system way more transparent than cash payments. This is a significant limitation for using crypto in illegal purposes.
According to the University of Technology Sydney, about 46% of criminal activity of each year is connected to Bitcoin. As for the drug sale itself, trade volumes in crypto keep rising, but the percent of Bitcoin drug transactions out of all transactions goes down. This means Bitcoin is more frequently used for legitimate purposes.
What cryptocurrency is used for drug sales most often? Surprisingly, privacy coins such as Monero are used only for 4% of transactions. Due to its pioneer position, Bitcoin is used in 76% of all deals despite all its anonymity risks.
The main problem for drug dealers using crypto is to turn their income into cash. This move remains complicated and insecure. Most cryptocurrency exchanges have instruments to define whether a transaction is coming from a suspicious source like the darknet. The rise of Monero use in the online drug market will hinder such tracking. However, for the reasons listed above, crypto is unlikely to completely replace regular cash in drug sales in the foreseeable future.
The views on how much cryptocurrency is used and will be used by terrorists vary widely. While some claim that terrorists have no infrastructure to use it and the methods are not secure enough, others argue that they are learning fast and adjust to crypto rapidly. Let’s see what both sides say.
Not actively using, unclear future
Lack of appropriate infrastructure, inability to use crypto. Most terrorist groups settle in the Middle East region, especially on its remote and war-torn territories. The vast majority of roads and technological infrastructure have been destroyed. In such circumstances, cash remains the most common and convenient way to pay and fundraise. Imagine a gun seller in a Syrian village – does it look like he has a tool to accept Monero?
Anonymity threats. Given the relative transparency of blockchain mentioned above, crypto might remain too unsafe for terrorists. Miners can see any potential terrorist money exchange while checking transactions, and it’s not too hard to see who sends them money. It can change with the rising use rate of privacy coins, but the ability to spend such money remains questionable.
Increased attention to crypto by the authorities. As the number of transactions keeps rising, more regulatory bodies’ attention gets focused on cryptocurrency, which apparently makes terrorists nervous and cautious.
Problems of specific currencies. While top cryptocurrencies like Bitcoin receive much regulatory attention, others remain marginal and unreliable because of a lack of support. Conflicts and uncertainty lower the trust to such cryptocurrencies – yes, even terrorists’ trust.
Using actively now, increasingly in the future
Terrorists seem to be rapidly learning to escape from tracking in blockchain. Several years ago it was easy to find any address or transaction made for a terrorists’ fundraiser. Today they use well organized and finely designed websites, where detailed video tutorials show how to donate money anonymously. Unique Bitcoin addresses and other crypto tricks are used to preserve security. Analysts from intelligence services claim there’s only going to be more such cases. And, of course, privacy coins are a “great opportunity” for terrorists too.
Shift to cryptocurrency is a reaction to economic sanctions. ISIS has lost most of its territory and resources, Hamas has been sanctioned by the West. Having been cut off from all main financial institutes, terrorist groups had to find other pathways for their financial activities – and cryptocurrency appeared to be the best substitute.
There might be difficulties and inconveniences, and the number of terrorists using crypto is yet unknown – but as we can see, digital money in terrorism is reality. Same as in drugs. And this is what cryptocurrency is notorious for, lacking trust among millions of people. The reputation of some of the exchange services only adds to this mistrust – ChangeNOW has carried out a special investigation on how such platforms may cheat their clients . But can you buy anything besides heroin and firearms with your crypto? What about pizza or a concert ticket?
Only Antarctica left
Cryptwerk , a platform monitoring actual use cases of different cryptocurrencies, says there are about 3500 ways to spend Bitcoin and more than 800 for Monero today. They range from music services to car rentals, from buying clothes to hotel booking services, and from sports bets to virtual tours.
Organizations accepting cryptocurrency are located on all continents besides Antarctica (what could be a better place for crypto than a continent without governments and countries though?). Mostly, in the USA and Central Europe. Bitcoin as the largest cryptocurrency is relatively widespread in India and Southeast Asia.
As this is a whole another topic, ChangeNOW will issue a post dedicated to use cases of cryptocurrencies. As it will be more detailed, who knows – maybe you’ll find a pizza right by that you could pay for from your crypto wallet!
This article was contributed by Jeremy from ChangeNow.
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