The intersection of cryptocurrency and intelligence operations has long fueled speculation, with Bitcoin often at the center of controversial claims. Mike Benz, a former U.S. State Department official and Executive Director of the Foundation for Freedom Online, has recently asserted in posts on X dated July 4 and July 13, 2025, that the CIA uses Bitcoin and stablecoins to launder money for covert operations, indirectly manipulating Bitcoin’s price to facilitate these activities. These claims suggest a sophisticated scheme where the CIA leverages the decentralized and borderless nature of cryptocurrencies to fund clandestine operations while maintaining U.S. geopolitical influence. This essay explores Benz’s allegations, detailing the mechanisms by which the CIA might allegedly pump Bitcoin’s price, the methods used for money laundering, and the purported benefits to the agency, while critically assessing the speculative nature of these claims and the lack of direct evidence. By examining these assertions, we aim to shed light on a complex and contentious topic at the nexus of finance, technology, and intelligence.
Key Points
Mike Benz claims the CIA uses Bitcoin and stablecoins for money laundering to fund covert operations, leveraging their borderless nature to move funds off-the-books. - The CIA allegedly pumps Bitcoin’s price indirectly through stablecoins, which are used to maintain dollar dominance and facilitate untraceable transactions. - Benefits include untraceable funding for covert activities, maintaining U.S. geopolitical influence, and avoiding congressional oversight, though these claims lack direct evidence and are highly speculative.
How the CIA Allegedly Pumps Bitcoin and Uses It for Money Laundering Mike Benz, a former State Department official and Executive Director of the Foundation for Freedom Online, has recently made claims on X suggesting that the CIA uses Bitcoin and stablecoins as tools for money laundering to fund covert operations, particularly in the context of U.S. foreign policy and intelligence activities. These claims, posted on July 4 and July 13, 2025, assert that Bitcoin’s price is driven by stablecoins, which the CIA employs for clandestine financial operations, while the U.S. Treasury benefits by propping up dollar dominance.
This essay synthesizes Benz’s claims, examines the alleged mechanisms by which the CIA might pump Bitcoin’s price, and evaluates the purported benefits, while critically assessing the lack of concrete evidence supporting these assertions.
Mechanisms for Pumping Bitcoin’s Price According to Benz, the CIA does not directly manipulate Bitcoin’s price but indirectly influences it through the use of stablecoins, which are cryptocurrencies pegged to assets like the U.S. dollar. In a post on July 4, 2025, Benz states, “The Bitcoin price is driven by stablecoins, not the other way around. The CIA uses stablecoins for the money laundering, while Treasury wants stablecoins pumped to prop up the US dollar”. He suggests that stablecoins, such as Tether (USDT) or USD Coin (USDC), are used to inject liquidity into the cryptocurrency market, which in turn boosts Bitcoin’s price.
This process allegedly involves the following steps:
1. **Stablecoin Issuance and Market Manipulation**: The CIA, in coordination with other entities, could facilitate the issuance of stablecoins through private companies or offshore entities. These stablecoins are then used to purchase Bitcoin on major exchanges, creating artificial demand that drives up Bitcoin’s price. Benz implies this is a deliberate strategy to maintain a high Bitcoin valuation, making it a reliable asset for covert transactions.
2. **Offshore Transactions and Anonymity**: Benz claims that stablecoins, due to their dollar-pegged stability and borderless nature, are ideal for moving large sums of money without detection. By converting funds into stablecoins and then into Bitcoin, the CIA can allegedly obscure the origin and destination of funds, bypassing traditional banking systems and congressional oversight. This is particularly useful for funding operations in regions where U.S. financial systems are restricted, such as countries under sanctions.
3. **Market Perception and Adoption**: By indirectly inflating Bitcoin’s price through stablecoin-driven demand, the CIA could enhance Bitcoin’s legitimacy and adoption, making it a more viable tool for covert transactions. A higher Bitcoin price signals market confidence, attracting more investors and increasing liquidity, which facilitates larger-scale money laundering without drawing attention. Benz’s posts suggest that this price-pumping mechanism is not about consumer use cases or libertarian ideals but rather about statecraft and intelligence operations. He argues that Bitcoin’s public ledger, while transparent, is paradoxically useful for the CIA because it allows funds to be moved globally without immediate traceability to U.S. government accounts.
Methods of Money Laundering Benz’s claims align with broader discussions about how cryptocurrencies can be used for money laundering, though he specifically ties this to CIA operations.
The alleged methods include:
1. **Use of Cryptocurrency Mixers**: The CIA could use mixing services or tumblers, like the notorious Bitcoin Fog, to obscure transaction trails. These services mix multiple transactions to make it difficult to trace funds back to their source. While Benz does not explicitly mention mixers, his reference to “CIA money laundering” implies sophisticated techniques to hide financial flows. For example, the 2024 conviction of Roman Sterlingov for operating Bitcoin Fog, which laundered $400 million, shows how such services work, though no CIA connection was established in that case.[]
(https://www.justice.gov/archives/opa/pr/bitcoin-fog-operator-sentenced-money-laundering-conspiracy)
2. **Layering Through Stablecoins**: Benz emphasizes stablecoins as the primary tool for CIA money laundering, suggesting they are used to layer funds through multiple transactions. Funds could be converted from fiat to stablecoins, then to Bitcoin, and moved through various wallets or exchanges, often in jurisdictions with lax regulations, to obscure their origins.
3. **NGO and Front Organizations**: Benz has previously linked the CIA to non-governmental organizations (NGOs) like USAID for covert operations. In the context of Bitcoin, the CIA could allegedly funnel funds through NGOs or shell companies that invest in cryptocurrencies, using these entities to purchase Bitcoin or stablecoins for operational purposes. This mirrors historical CIA tactics, such as using front companies during the Iran-Contra affair.[]
(https://www.realclearpolitics.com/video/2025/07/09/mike_benz_tracing_jeffrey_epsteins_intelligence_connections_back_to_iran-contra.html)[](https://www.realclearpolitics.com/video/2025/07/09/mike_benz_tracing_jeffrey_epsteins_intelligence_connections_back_to_iran-contra.html)
4. **Exploiting Decentralized Nature**: Bitcoin’s decentralized structure allows transactions without intermediaries like banks, which Benz claims is ideal for the CIA’s needs. By using anonymous wallets and decentralized exchanges, the agency could move funds globally without triggering anti-money laundering (AML) or know-your-customer (KYC) protocols.
Benefits to the CIA Benz’s posts outline several benefits the CIA allegedly derives from using Bitcoin and stablecoins for money laundering, particularly in the context of covert operations:
1. **Untraceable Funding for Covert Operations**: Bitcoin and stablecoins allow the CIA to fund operations without relying on congressional appropriations or traditional banking systems, which are subject to oversight. Benz suggests this is critical for activities deemed “too dirty” for direct CIA involvement, such as regime change operations or funding paramilitary groups. For instance, he references USAID’s alleged role in a CIA-backed fake vaccine program in Pakistan, indicating a pattern of covert financial maneuvers.
(https://www.zerohedge.com/political/when-its-too-dirty-cia-benz-usaids-litany-corruption)[](https://www.zerohedge.com/political/when-its-too-dirty-cia-benz-usaids-litany-corruption)
2. **Maintaining U.S. Geopolitical Influence**: By using stablecoins to prop up the U.S. dollar’s dominance, the CIA indirectly supports Treasury goals while funding operations. Benz claims this dual purpose—dollar stabilization and covert funding—makes cryptocurrencies a strategic tool for U.S. statecraft. A high Bitcoin price enhances its utility as a global currency, facilitating transactions in regions where fiat currencies are restricted.
3. **Bypassing Legal and Regulatory Constraints**: After the CIA faced restrictions post-1970s, following scandals like the Church Committee findings, Benz argues that agencies like USAID and NGOs took over covert operations. Bitcoin provides a modern equivalent, allowing the CIA to bypass legal prohibitions on domestic surveillance or unauthorized foreign operations by using a decentralized financial system.[]
(https://www.realclearpolitics.com/video/2025/07/09/mike_benz_tracing_jeffrey_epsteins_intelligence_connections_back_to_iran-contra.html)
4. **Scalability and Global Reach**: Bitcoin’s borderless nature enables rapid, large-scale fund transfers to operatives or allies worldwide, without the delays or scrutiny of traditional financial systems. Benz’s claim that “Bitcoin is one of the few pure play bets on the market for CIA money laundering” underscores its perceived utility for global intelligence operations.
Critical Assessment
While Benz’s claims are provocative, they lack direct evidence and rely heavily on speculation. The transparency of Bitcoin’s blockchain, where every transaction is publicly recorded, makes it an unlikely tool for sophisticated money laundering, as noted by critics on X who argue that using Bitcoin for such purposes is akin to “robbing a bank livestreaming on TikTok”. Blockchain analytics, as used in cases like Bitcoin Fog and Silk Road, have proven effective in tracing illicit transactions, undermining the idea that Bitcoin is ideal for CIA operations.[]
(https://www.justice.gov/archives/opa/pr/bitcoin-fog-operator-sentenced-money-laundering-conspiracy)
Moreover, Benz’s credibility is debated due to his past as the alt-right persona “Frame Game,” which he claims was a covert effort to combat anti-Semitism, though this explanation is met with skepticism. His allegations about USAID and the CIA, while amplified by figures like Elon Musk, have been criticized as fringe and lacking substantiation. Historical CIA operations, such as the Iran-Contra affair or the use of front companies, provide context for his claims, but no declassified documents or official reports confirm Bitcoin’s use for money laundering by the CIA.[]
(https://www.nbcnews.com/tech/internet/michael-benz-rising-voice-conservative-criticism-online-censorship-rcna119213)[](https://www.nbcnews.com/politics/doge/elon-musk-boosted-false-usaid-conspiracy-theories-global-aid-rcna190646)[](https://www.realclearpolitics.com/video/2025/07/09/mike_benz_tracing_jeffrey_epsteins_intelligence_connections_back_to_iran-contra.html)
Public evidence points to Bitcoin being used primarily by criminals, not intelligence agencies, for money laundering. For example, the U.S. Secret Service’s 2024 indictment of Aliaksandr Klimenka for operating BTC-e, a digital currency exchange, highlights criminal misuse, with no mention of state actors. Similarly, a 2021 report by former CIA Acting Director Michael Morell concluded that Bitcoin’s role in illicit finance is overstated, as criminals increasingly move to other avenues due to its traceability.[]
(https://www.secretservice.gov/newsroom/releases/2024/02/foreign-national-charged-international-money-laundering-conspiracy-and)[](https://www.coindesk.com/markets/2021/04/13/ex-cia-director-says-criminals-will-move-away-from-bitcoin-in-new-lobbying-groups-first-report)
Conclusion
Mike Benz’s claims suggest a complex scheme where the CIA uses stablecoins to indirectly pump Bitcoin’s price, leveraging its decentralized nature to launder money for covert operations. The alleged benefits include untraceable funding, geopolitical influence, and bypassing legal constraints. However, these claims are speculative, lacking concrete evidence, and are complicated by Bitcoin’s transparent ledger and Benz’s controversial background. While the CIA’s historical use of covert financial tactics lends plausibility to the idea, no public data confirms Bitcoin’s role in such activities. The topic remains a contentious blend of conspiracy theory and geopolitical intrigue, warranting cautious scrutiny.
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