CIA Uses Bitcoin in Tech Confrontation with China

Deputy CIA Director Michael Ellis revealed that the agency employs Bitcoin and other cryptocurrencies not only to trace financial flows of hostile organizations but also to actively disrupt their operations.

He emphasized that Bitcoin is not an anonymous system but a pseudonymous one, allowing analysts to follow transaction trails. To this end, the CIA works closely with law enforcement agencies to analyze and block illicit crypto payments.

According to Ellis, cryptocurrencies have become “another tool in the U.S. arsenal,” essential for ensuring that the United States does not fall behind China in the race for technological supremacy. He noted that “Bitcoin isn’t going away,” and that growing institutional adoption confirms it is no longer a matter of choice for Washington but a matter of leadership.

Concrete CIA Use Cases

1. Ransomware payout tracking. CIA analysts identify wallets receiving ransom payments and work with law enforcement to freeze or divert those funds, crippling attackers’ revenue streams.

2. Disruption via transaction spoofing. By injecting bogus transactions into an adversary’s wallet activity, the agency sows confusion and delays funding to terrorist and cybercrime networks.

3. Blockchain trail construction. In partnership with firms like Chainalysis and Elliptic, the CIA reconstructs end-to-end transaction graphs, linking pseudonymous addresses to real-world identities and enabling asset seizures.

Bitcoin as a Pseudonymous System

Ellis stressed that Bitcoin is pseudonymous, not anonymous—its transparent ledger enables detailed chain-of-custody analysis. The CIA collaborates closely with federal agencies to detect and halt illicit crypto flows.

Global Implications of Intelligence Crypto Tools

1. Regulatory realignment. Intelligence use of crypto accelerates the push for clear global standards around blockchain VASPs and fosters cross-border cooperation on anti–money laundering.

2. Privacy technology boom. Expanded surveillance capabilities drive innovation in privacy-preserving tools—Zero-Knowledge Proofs and beyond—to safeguard personal data.

3. Technological arms race. Integrating crypto into intelligence operations intensifies digital arms development, underscoring the need for US leadership against similar Chinese and Russian programs.

4. New balance of power. While agencies gain potent monitoring tools, civil society and industry innovate countermeasures to protect individual privacy and maintain trust in distributed systems.

Google Wallet Adds Zero-Knowledge Proof for Age Verification

Google has announced support for Zero-Knowledge Proof (ZKP) in its Google Wallet app to enable secure and private age verification.

This technology allows the user’s attributes (for example, date of birth) to be stored encrypted on their device via the Digital Credential API. When age verification is requested, Wallet generates a cryptographic proof that the user meets the required age threshold—without revealing the actual date of birth.

The first partner for the new system is Bumble, which will use ZKP to simplify and secure age checks during user onboarding, eliminating the need to share personal documents.