Hamas receives $7,3 million in cryptocurrency donations, posing challenges for global anti-terrorism efforts.
The militant Islamist group Hamas, which controls Gaza, launched a tremendous attack against Israel. The attack resulted in the lamentable loss of more than 1,500 civilian lives and the capture of many hostages.
Notably, Hamas has partially funded its military operations with crypto donations. Using cryptocurrencies makes it more difficult to trace and obstruct transactions than traditional money transfer methods.
Hamas Acquires $7,3 Million Worth of Cryptocurrency
According to a blockchain analytics firm Elliptic report, Hamas’ military wing received more than $7.3 million in various cryptocurrecies, including $40,000 in Dogecoin, a meme-inspired digital coin that Tesla CEO Elon Musk famously promoted.
Although this sum may seem small compared to the annual $100 million provided by Iran to Hamas and other Palestinian militant groups, the $360 million pledged by Qatar for Gaza’s aid, or the estimated $300 million collected by Hamas through taxes and extortion within their controlled territory, it cannot be understated.
Even modest sums can have a significant impact in the context of low-budget and low-tech attacks. Al-Qaeda’s September 11th, 2001 terrorist attacks serve as an illustration. It was reported that these assaults cost them approximately $500,000 but caused the United States a staggering $3.3 trillion in damages.
Challenges of Crypto in Counter-Terrorism
Counterterrorism initiatives face obstacles posed by cryptocurrencies. It enables rapid and anonymous cross-border funds transfers, leaving only a digital footprint that is difficult to trace. In addition, it plays a role in the broader landscape of terrorism financing, which frequently involves social media platforms, remittance services, and prepaid cards.
During times of conflict, terrorist organizations tend to increase their fundraising efforts. In April 2023, Hamas temporarily stopped accepting Bitcoin donations, but this suspension may only last for a while.
Notably, Australia’s financial intelligence agency recently warned about crypto donation solicitations for Hamas on the messaging platform Telegram.
Global Crackdown on Cryptocurrency-Funded Terrorism
Global governments are adopting decisive measures to combat the threat posed by using cryptocurrencies to fund terrorism. Israel has recently taken action by seizing multiple crypto accounts associated with Hamas and even a Barclays bank account believed to have connections to the organization.
Following suit, the US Treasury imposed sanctions on various Hamas-affiliated entities and individuals, including a Gaza-based cryptocurrency company called “Buy Cash” that facilitated remittances for Hamas affiliates.
The Treasury’s statement emphasized the fundraising aspect of cryptocurrencies and Buy Cash’s use of cryptocurrencies for financial transactions supporting Hamas.
