In their arsenal of modern warfare, Hamas uses rockets, drones,
and even paragliders. In the digital sphere, they leveraged mobile phones and
internet connections to broadcast their actions globally. But the burning
question is, where did the money for all this come from?
Cryptocurrency. Yes, you heard it right. The darling of the
decentralized financial world, crypto, has a dark side, too. It’s not just a
tool for rebellious libertarians or tech-savvy traders; it’s also the secret
weapon of militant groups.
In August 2020, the US government managed to seize millions
of dollars from a number of groups which had been using crypto to fund
their activities. But here’s the shocker: Palestinian Islamic Jihad, one the groups
responsible for seizing Israeli hostages, still managed to collect a staggering
$93 million worth of cryptocurrency between June 2021 and August 2023, according
to the WSJ. Hamas, the heavyweight of Palestinian groups, also raked in
around $41 million in digital payments .
Now, we’re not entirely sure how much they’ve got, but here’s a little
insight: in 2022, US authorities slapped sanctions on Hamas’ investment office,
which reportedly had assets totaling $500 million.
And here’s a staggering figure to chew on—the UN estimates that crypto accounts
for a whopping 20%
of global terror funding.
Calls for Donations Since at Least 2019
Hamas affiliates, including its notorious military wing, the
Al-Qassam Brigades, have been openly asking for Bitcoin donations since at
least 2019. But here’s the kicker: these groups are not choosy. They’ve dabbled
in various currencies, from dogecoin, which Elon Musk casually tweets about, to
stablecoins like Tether and USDC, tied to the mighty US dollar. Amazingly, these
calls where still happening even as the militants attacked. Israel Police’s Lahav 433 cyber unit
was working with Binance to lock down accounts linked to Hamas and to transfer
the funds to the state. Since 2021, the
authorities have confiscated 189 cyrpto accounts tied to Palestinian militant
groups on Binance.
Israel Police Freeze #Crypto Accounts Held at #Binance Allegedly Used by Hamas https://t.co/fxxURZk5ul
— Bitcoin.com News (@BTCTN) October 11, 2023
In a report from August 2023, Elliptic, a watchdog for crypto
compliance, even mentioned that wallets it was keeping tabs on indicated that
these terror groups were investing in DeFi protocols and making money using
Solana, the crypto superstar backed by FTX’s
Sam
Bankman-Fried.
How Does This Happen?
Now, you might wonder how these organizations manage to get their
hands on crypto when they can’t exactly stroll into the New York Stock
Exchange. The answer? Smart contracts that conveniently sidestep those pesky
“know-your-customer” (KYC) checks. According to Elliptic, some of
these groups are even into crypto mining, which is essentially profiting from
the nuts and bolts of cryptocurrency networks.
To counter this, Israeli and US officials have been trying to rope
in crypto exchanges like Binance to block access for users tied to these
groups. They’re focusing their efforts on the Financial Action Task Force (FATF), a global body setting
the rules to prevent money laundering. The FATF still lists dozens of countries
on its “grey list,” meaning they haven’t met these standards. And it
includes names like Jordan, Syria, and the United Arab Emirates.
In their arsenal of modern warfare, Hamas uses rockets, drones,
and even paragliders. In the digital sphere, they leveraged mobile phones and
internet connections to broadcast their actions globally. But the burning
question is, where did the money for all this come from?
Cryptocurrency. Yes, you heard it right. The darling of the
decentralized financial world, crypto, has a dark side, too. It’s not just a
tool for rebellious libertarians or tech-savvy traders; it’s also the secret
weapon of militant groups.
In August 2020, the US government managed to seize millions
of dollars from a number of groups which had been using crypto to fund
their activities. But here’s the shocker: Palestinian Islamic Jihad, one the groups
responsible for seizing Israeli hostages, still managed to collect a staggering
$93 million worth of cryptocurrency between June 2021 and August 2023, according
to the WSJ. Hamas, the heavyweight of Palestinian groups, also raked in
around $41 million in digital payments .
Now, we’re not entirely sure how much they’ve got, but here’s a little
insight: in 2022, US authorities slapped sanctions on Hamas’ investment office,
which reportedly had assets totaling $500 million.
And here’s a staggering figure to chew on—the UN estimates that crypto accounts
for a whopping 20%
of global terror funding.
Calls for Donations Since at Least 2019
Hamas affiliates, including its notorious military wing, the
Al-Qassam Brigades, have been openly asking for Bitcoin donations since at
least 2019. But here’s the kicker: these groups are not choosy. They’ve dabbled
in various currencies, from dogecoin, which Elon Musk casually tweets about, to
stablecoins like Tether and USDC, tied to the mighty US dollar. Amazingly, these
calls where still happening even as the militants attacked. Israel Police’s Lahav 433 cyber unit
was working with Binance to lock down accounts linked to Hamas and to transfer
the funds to the state. Since 2021, the
authorities have confiscated 189 cyrpto accounts tied to Palestinian militant
groups on Binance.
Israel Police Freeze #Crypto Accounts Held at #Binance Allegedly Used by Hamas https://t.co/fxxURZk5ul
— Bitcoin.com News (@BTCTN) October 11, 2023
In a report from August 2023, Elliptic, a watchdog for crypto
compliance, even mentioned that wallets it was keeping tabs on indicated that
these terror groups were investing in DeFi protocols and making money using
Solana, the crypto superstar backed by FTX’s
Sam
Bankman-Fried.
How Does This Happen?
Now, you might wonder how these organizations manage to get their
hands on crypto when they can’t exactly stroll into the New York Stock
Exchange. The answer? Smart contracts that conveniently sidestep those pesky
“know-your-customer” (KYC) checks. According to Elliptic, some of
these groups are even into crypto mining, which is essentially profiting from
the nuts and bolts of cryptocurrency networks.
To counter this, Israeli and US officials have been trying to rope
in crypto exchanges like Binance to block access for users tied to these
groups. They’re focusing their efforts on the Financial Action Task Force (FATF), a global body setting
the rules to prevent money laundering. The FATF still lists dozens of countries
on its “grey list,” meaning they haven’t met these standards. And it
includes names like Jordan, Syria, and the United Arab Emirates.
