Cryptocurrency donations to extremist groups have fallen globally but are rising in Europe, according to a report from blockchain data platform Chainalysis.

It shows that most crypto donations to extremist groups came from North America before 2017. Since then, Europe has been steadily catching up with inflows. For example, between 2022 and 2024, Europe accounted for nearly 50% of extremist group on-chain activity.

Not only are crypto donations to extremist groups in Europe increasing, but so are the size and donor density of those donations.

The report notes that from 2023 to 2024, at least five types of extremist groups experienced year-over-year increases in deposit size: white nationalist (270%), nationalist (164%), conspiracy (70%), anarchist (35%), and antisemitic (22%).

Highly polarizing events, such as national elections, create a vortex that attracts more donations, often resulting in a flow of money to extremist groups that espouse radical ideologies.

While crypto donations to extremist groups in Europe are increasing, North America still leads all regions with a total of $20 million donated to these groups. Europe comes in second with $1.9 million, Oceania comes in third with $319,000, with donations totaling $162,000 from undisclosed regions.

The report states that extremist groups face legal and financial challenges.

For example, counterterrorism financing laws and regulations from the Office of Foreign Assets Control (OFAC) in the United States and similar government agencies around the world stipulate that cryptocurrency exchanges must ban, flag, and halt terrorism-related crypto activities.

Some centralized crypto exchanges have violated these laws and received significant penalties. In November 2023, the US government fined Binance $4.3 billion for failing to comply with Anti-Money Laundering (AML) laws. Binance allegedly failed to report suspicious transactions that were later proven to be linked to various terrorist organizations.

However, extremist groups have proven adept at changing their fundraising methods. Often alienated from the mainstream internet, they turn to the dark web to further their cause.

Some have gone a step further and removed public postings of cryptocurrency donation addresses and opted to forward the addresses directly to backers. Others use privacy coins like Monero (XMR).

To raise more money, extremist groups often cross-pollinate their ideologies—essentially blending them. By uniting different extremist movements and focusing their supporters on a common enemy, they are able to attract more funding.

One of the most controversial issues surrounding hate groups is “debanking,” or the closing of bank accounts associated with high-risk individuals and organizations. The debate sometimes includes the practice itself, because it goes against not only principles such as freedom, but also individuals and organizations designated as “high risk”, which may depend on political climates.

As the Chainalysis report notes, many currently unbanked groups may seek additional financing methods, including cryptocurrency. Extremist groups outside the traditional banking system are using crypto as a tool to evade sanctions and continue to fund their activities.