No Evidence of Successful Crypto Use by Hamas
According to blockchain forensics firm Elliptic, recent claims about the scale of cryptocurrency fundraising by the terror group Hamas are inaccurate. The firm has found little evidence to support the notion that terrorist organizations are successfully utilizing crypto. This contradicts an article published by the Wall Street Journal, which stated that Hamas and Palestinian Islamic Jihad raised over $130 million in crypto between August 2021 and June 2023. However, Elliptic has refuted these claims, stating that the data provided by them and others has been misinterpreted.
Elliptic Challenges Mainstream Media’s Terrorist Financing Accusations
In an effort to debunk mainstream media’s attempts to link crypto with terrorist financing, Elliptic explained that while Hamas did solicit bitcoin donations in 2019, it stopped public-facing crypto fundraising in April due to concerns for donor safety. The organization also faced increased hostility towards its supporters. Since the recent attack in Israel, Hamas has only received $21,000 in fresh crypto, most of which is frozen. This highlights the limitations of using crypto as a fundraising tool for terrorism. Blockchain transparency allows illicit funds to be traced and linked to real-world identities, while centralized services like exchanges respond to law enforcement requests to freeze funds tied to illicit activities.
Tiny Portion of Crypto Activity Relates to Terrorist Financing
While acknowledging that terrorist financing is a part of illicit crypto activities, Elliptic emphasizes that it constitutes a minuscule portion. Historically, terrorist organizations have relied on traditional fiat-based financing methods such as financial institutions and shell companies. Despite some terrorist groups using cryptocurrencies for fundraising and transactions, the amounts raised remain insignificant compared to other funding sources. It is crucial to understand that crypto is not the primary means through which terrorists finance their operations.
Hot Take: Misrepresentation of Cryptocurrency Fundraising by Hamas
The recent claims about Hamas successfully utilizing cryptocurrency for fundraising have been refuted by Elliptic, a blockchain analytics firm. The Wall Street Journal article that initially reported on these claims has been criticized for misinterpreting the data. While terrorist financing does occur within the crypto space, it represents only a small fraction of illicit cryptocurrency activities. Terrorist organizations predominantly rely on traditional fiat-based methods for financing. The transparency of blockchain technology allows for the traceability of funds, making it challenging for terrorists to raise significant amounts through crypto. It is important to separate fact from misinformation when discussing the potential misuse of cryptocurrencies by terrorist groups.
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