Key Takeaways:
- Israel has cooperated with Binance to seize crypto assets belonging to Hamas.
- The confiscation comes amid the recent attacks on Israel by the terror outfit.
- Cryptocurrencies continue to play a role in terror financing globally.
YEREVAN (CoinChapter.com) — In response to recent attacks by the Palestinian terror group Hamas, Israeli law enforcement has confiscated cryptocurrency accounts reportedly linked to the organization. It is alleged that Hamas funneled funds acquired through social media into custodial wallets on Binance, the largest cryptocurrency exchange.
According to local media reports, the crackdown came from Lahav Cyber Unit 433 in the Israel Police. The National Headquarters for Economic Combating Terrorism (MTL) and the Shin Bet also participated in the operation.
Since the launch of Hamas’s unexpected attack on Israel, the militant group has utilized social media for fundraising activities. One such account, according to the police, was at the Barclays bank. Israeli authorities had worked with UK police to freeze this account.
However, the amount of crypto or total accounts seized remains unknown.
Binance helps freeze Hamas crypto account
The recent seizure of the assets of Hamas is significant, as it comes with the support of Binance. The exchange has increasingly faced crackdowns by authorities for a series of violations.
“With the outbreak of the war, Hamas launched a fund-raising campaign on social networks, and asked the public to deposit the crypto-currencies into his account. The cyber unit and MTL acted immediately to locate the accounts and freeze them, with the assistance of the crypto exchange Binance, in order to transfer the funds to the state treasury,”
Lahav Cyber Unit 433 in the Israel Police said in a statement.
In March, the US Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance, alleging several violations. The lawsuit, among numerous others, even suggested that Binance may have been involved in potentially criminal activities, such as money laundering.
Binance had also earlier faced accusations of tolerating small amounts of crypto transactions by Hamas. The latest confiscation, therefore, is part of the exchange’s attempts to avoid further problems with the law.
“Over the past few days our team has been working in real time, around the clock, to support ongoing efforts to combat terror financing. The data we use to pinpoint individuals, addresses, and infrastructures associated with specific organizations stems from intelligence provided by law enforcement and investigative tools we, and our partners, have developed,”
a Binance spokesperson told news agency Reuters.
The development, meanwhile, has raised questions among many users as to why the terror outfit chose to receive and store funds on a centralized exchange. Without safe crypto practices, the confiscation of assets becomes easy for authorities.
Terror outfits have a history of organizing crypto fundraisers
A Tel Aviv-based crypto analytics firm, BitOK, has uncovered that accounts associated with Hamas received a staggering $41 million worth of cryptocurrency between 2021 and June 2023. Around the same time, Palestinian Islamic Jihad (PIJ), another Hamas-like terror outfit, received as much as $93 million in crypto, according to The Wall Street Journal.
Since 2021, Israel’s National Bureau for Counter-Terror Financing (NBCTF) has seized cryptocurrency in 11 other instances.
In August 2020, the United States Department of Justice (DOJ) made a significant announcement about a worldwide operation to disrupt three terrorism financing campaigns. This operation included the confiscation of cryptocurrency accounts linked to the al-Qassam Brigades.
In April 2023, under pressure, the Al-Qassam Brigades (AQB) of Hamas discontinued its cryptocurrency fundraiser efforts.
However, Hamas is not the only terror group that relies on crypto donations.
Earlier this year, Israeli authorities successfully disrupted the cryptocurrency infrastructure used for financing terrorism by Hezbollah and Iran’s Quds Force. In the operation, they seized an initial sum of $1.7 million with the help of Chainalysis.
A July 2020 study published in a Centre for Security Studies journal highlighted how terrorist organizations use social media for crypto fundraising.
“Many supporters and sympathizers chose to make donations to terror organizations, but given the increasingly tightening grip of counter terrorism agencies, many fear carrying out physical transactions due to the legal and financial risks involved6. These supporters find a more secure medium through crypto currency exchange,”
the report reads.
Other terror outfits using crypto donations include A lQaeda-affiliated group Al-Sadaqah, the Hayat Tahrir al-Sham (HTS) in Syria, and ISIS.
