Recent reviews suggesting that crypto has performed a big position in terrorism funding have been debunked by blockchain forensics agency Elliptic.
According to a report by Elliptic printed this week, the transparency and traceability of the blockchain make it difficult for terrorist teams like Hamas to successfully use crypto for fundraising.
Hamas, which started soliciting Bitcoin (BTC) donations in 2019, noticed its crypto fundraising peak in the course of the May 2021 outbreak of violence.
However, in April 2023, it suspended all public-facing crypto fundraising actions resulting from security considerations for donors and elevated scrutiny by legislation enforcement.
Additionally, the seizure of crypto wallets, the identification of donors, and the shutdown of fundraising web sites hindered their efforts.
Elliptic famous that probably the most outstanding crypto fundraising marketing campaign following the October 7th Hamas assaults obtained solely $21,000 in crypto donations, a good portion of which was frozen by crypto companies and researchers.
In distinction, crypto fundraising for humanitarian causes in Israel obtained substantial assist.
Challenges crypto terror fundraising narrative
The findings problem the notion that terrorist teams have efficiently raised tens of millions of {dollars} by means of crypto fundraising.
In July, the National Bureau for Counter Terror Financing issued a seizure order for crypto wallets linked to the Palestinian Islamic Jihad, which allegedly obtained over $93 million in transactions between 2020 and 2023.
However, Elliptic clarified that this doesn’t imply the group “raised” all these funds, and a few of the wallets seemingly belonged to small service suppliers utilized by terrorist organizations.
In the report, Elliptic additionally emphasised the significance of a nuanced and detailed understanding of blockchain evaluation when discussing delicate matters like crypto’s position in terrorism funding.
“Terrorist groups do make use of cryptoassets for public fundraising, but the amounts involved are tiny relative to other funding sources,” the agency mentioned, earlier than concluding:
“Careful and detailed understanding of blockchain analysis is needed whenever approaching a nuanced and sensitive topic such as this, and the full context of any analysis should be provided by those using these insights.”
