Conspiracy theorists picked up on an utterly unsupported narrative that FTX had helped the Biden Administration funnel funds supporting the Ukrainian war effort back to the Democratic Party.
Conspiracy theorists allegedly pushed by Russian propaganda picked up on an utterly unsupported narrative that FTX had helped the Biden Administration funnel funds supporting the Ukrainian war effort back to the Democratic Party.
A disinformation campaign peddling a conspiracy theory that the bankrupt FTX exchange was helping the Biden Administration funnel money to the Democratic Party has gotten enough traction that it had to be refuted, according to a Ukrainian Deputy Minister.
Alex Bornyakov, Deputy Minister for Digital Transformation, took to Twitter on Monday to say “Ukraine's gov never invested any funds into FTX. The whole narrative that Ukraine allegedly invested in FTX, who donated money to Democrats is nonsense, frankly,” ending with a facepalm emoji.
The crypto community has been hugely successful in raising funds for Ukraine’s war effort, with the fundraising group Aid for Ukraine raising $60 million to support the war effort and humanitarian relief. The country has raised hundreds of millions in crypto, $135 million of it by June, Coindesk reported.
What Aid for Ukraine did do, Bornyakov said, is use FTX to off-ramp the more than $60 million collected by the fundraising group Aid for Ukraine into the fiat currency it needs to buy everything from bullets to bandages in support of its war effort.
The nonprofit was backed by Ukraine’s Kuna exchange, staking platform Everstake and FTX — which has (or had) FTX Pay, a business that allows merchants to let customers use crypto in payment at the register and on websites, but receive fiat currency.
Binance and Coinbase have similar divisions, and there are a number of companies dedicated to the business, including Strike and BitPay.
Propaganda Going Mainstream
Aid for Ukraine also addressed the rumors, tweeting that it is a “Russian propaganda” campaign that “uses the FTX crisis to obstruct Ukrainian crypto fundraising.”
In an 11-part Twitter thread on Nov. 15, Aid for Ukraine took aim at what it alleges are propaganda spreaders in the U.S. It said:
“Certain Twitter users, including fake accounts of US congressmen and biased media outlets, have disseminated rumors that hundreds of millions of USD donated to Ukraine were illegally transferred to the US Democratic Party.”
That narrative “does not correspond with reality,” it said, adding that $54 million of the crypto it raised has “already been spent on Ukraine’s humanitarian and military needs.”
While the story about Ukraine not just funneling money to Democrats but investing in FTX in order support former FTX CEO (and former billionaire) Sam Bankman-Fried’s eight-figure political donations — which did go largely to Democrats — was first popular on extremist websites like 4Chan and far right media sites — liberally laced with anti-Semitism — it rapidly became gained more mainstream .
Media industry site Media Matters pointed out that Twitter owner Elon Musk “amplified conspiracy theories about FTX’s collapse," calling it "the latest instance in Musk’s long history of amplifying far-right content on the platform."
On Nov. 15, Fox News covered the story, pointing to Bankman-Fried’s enormous political contributions that went largely to Democrats. It said:
“In addition to the company's dealings with Democrats, FTX is also being scrutinized for potential connections to the war in Ukraine. Despite a Ukrainian crypto official denying investments into FTX, [‘Fox & Friends Weekend’ host Will] Cain argued it is worth questioning the connection of Democrats and politicians supporting the war in Ukraine.”
Cain was quoted as saying: "We're journalists asking an important question: was money from Ukraine going back to the people that were voting to fund the war in Ukraine?"
The article did not try to answer the question in any way.
