US Treasury Department investigates funding of Hamas with cryptocurrencies

The US Treasury Department is reportedly investigating $165 million worth of crypto transactions potentially linked to Hamas. Especially before its attack on Israel on October 7, 2023. This investigation highlights the role of cryptocurrencies in global finance and the financing of terrorism.

Does Hamas use cryptocurrencies for funding?

According to the Wall Street Journal (WSJ), he reveals Investigation, which is based on a report submitted to Congress that the U.S. Treasury's Financial Crimes Enforcement Network (FinCEN) analyzed suspicious activity reports. These reports, covering the last three years and emanating from American financial institutions, are said to include transactions that may have facilitated the activities of the militant group.

However, FinCEN notes that the scale of Hamas' use of cryptocurrencies may be less significant than initially thought. This suggests that only a small portion of transactions can be directly linked tohustle. This development follows controversy surrounding the role of digital currencies in financing terrorism.

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Amid the conflict between Israel and Hamas in October 2023, allegations emerged from data analyzed by blockchain analytics firm Elliptic. The Wall Street Journal reported that Hamas received millions of donations via digital currencies.

However, Elliptic later clarified that its data had been misinterpreted. In fact, only $21,000 was donated to Hamas through this, with much of that money frozen by cryptocurrency providers.

Terrorist groups still prefer traditional financing methods

Later, in December 2023, Senators Mitt Romney and Mark R. Warner Terrorism Financing Prevention Act, Mike Rounds and Jack Reed. The Act provides Treasury with the tools necessary to address threats arising from digital assets in terrorist financing.

However, in February 2024, Brian Nelson, U.S. Treasury Undersecretary for Terrorism and Financial Intelligence, addressed lawmakers. He pointed out that the impact of digital currencies on funding the Hamas movement may have been exaggerated.

"The numbers cited in the Wall Street Journal article talk about wallets, but not necessarily the destination. We also estimated that terrorists still prefer to use traditional services rather than digital assets. We do not expect the amount sent to Hamas is very large. .

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While recognizing the potential for misuse of digital assets, these clarifications highlight terrorist groups' continued preference for traditional financial systems. This also indicates biased political interpretations of financial reports related to the Hamas movement.