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    • Apr 10
    • 4 min read

Uncovering the Link: How Cryptocurrency Facilitates Hamas's Terrorist Financing




This in-depth analysis delves into the utilisation of cryptocurrency by Hamas for terrorist financing, set against the backdrop of current geopolitical shifts and the crucial role of Israeli intelligence.

Historical Context of Cryptocurrency in Terrorist Financing The adoption of cryptocurrencies by terrorist organisations like Hamas, ISIS, and al-Qaeda, marks a significant shift in terrorist financing methods. Hamas's use of Bitcoin since January 2018 underscores this trend, reflecting a move towards digital currencies to evade global financial scrutiny and sanctions.

"Those seeking to stop Hamas will need to be as nimble and creative as the adversary, using the tools already at our disposal to identify and disrupt its financial network,” Yaya J. Fanusie, a former CIA analyst and the director of policy for anti-money laundering and cyber risk at the Crypto Council for Innovation.

Hamas's Sophisticated Financial Strategies Amidst Geopolitical Shifts Hamas has employed advanced strategies for leveraging cryptocurrency, including public solicitation for Bitcoin donations through social media and encrypted messaging platforms. 

Hamas has demonstrated a nuanced understanding of cryptocurrency, leveraging it to bypass global sanctions and scrutiny, a strategy that has evolved significantly in recent years. Their approaches include:

1. Public Solicitation for Bitcoin Donations: Hamas has effectively used social media and encrypted messaging platforms for global fundraising in Bitcoin, exploiting these channels' relative anonymity.

2. Use of Multiple Digital Wallets: To evade detection, Hamas frequently changes its digital wallet addresses, a tactic that complicates the efforts of authorities to track and freeze their financial assets.

3. Engagement with Lax Cryptocurrency Exchanges: Hamas has utilized cryptocurrency exchanges with minimal regulatory compliance to covertly convert digital currencies into traditional currencies, facilitating cross-border fund transfers.

4. Adaptive Financing Strategies: In response to increased regulatory scrutiny, Hamas has adapted its methods, potentially moving towards privacy-focused cryptocurrencies and emerging technologies to maintain operational secrecy.

5. Decentralised Fundraising Mechanisms: The decentralised nature of cryptocurrencies enables Hamas to conduct fundraising from a wide base of international supporters, complicating efforts to detect and disrupt these activities.

Israeli Intelligence in Counter-Terrorist Financing

Israeli intelligence has been actively involved in combating Hamas's terrorist financing, particularly in the realm of cryptocurrency usage. Israeli intelligence has been actively combating Hamas's use of cryptocurrency for terrorist financing. Since 2021, Israel has made significant strides in this area, seizing 189 crypto accounts linked to terror groups, including Hamas. These efforts are part of a broader strategy to disrupt the financial networks of terrorist organizations and prevent them from accessing funds through digital currencies. The seizure of these accounts demonstrates Israel's commitment to utilising advanced technological and intelligence capabilities to counter the evolving tactics of groups like Hamas in using cryptocurrencies for their operations.

More specifically, Israeli's efforts are multifaceted and leverage their advanced technological and intelligence capabilities. Key aspects of these efforts include:


  1. Surveillance and Analysis: Israeli intelligence agencies utilize advanced surveillance methods and cryptographic analysis to track and monitor cryptocurrency transactions linked to terrorist activities. This includes identifying digital wallets used by Hamas and tracing the flow of funds to disrupt their financial networks.

  2. Strategic Collaboration: Israeli intelligence collaborates with international partners to enhance global efforts against terrorist financing. This collaboration is crucial given the borderless nature of cryptocurrency transactions and the decentralised structure of terrorist networks.

  3. Countermeasures Against Evasion Tactics: As part of their strategy, Israeli intelligence focuses on countering the sophisticated methods Hamas employs to evade global scrutiny and sanctions. This involves adapting to Hamas's use of multiple digital wallets, engagement with cryptocurrency exchanges with minimal regulatory compliance, and decentralized fundraising mechanisms.

  4. Global Counterstrategies: Israeli intelligence contributes to global counterstrategies, such as the U.S. Treasury's sanctions against Hamas officials and entities. These sanctions are part of a coordinated international response to the emerging financial threats posed by the use of digital currencies in terror financing.


Global Countermeasures and Collaborative Efforts

Recent actions by The U.S. Department of the Treasury's Office of Foreign Assets Control including imposing sanctions on key members, operatives, and financial facilitators of Hamas, targeted over 1,000 individuals and entities connected to terrorism and terrorist financing by Iran and its proxies. These measures reflect a growing understanding of the role of cryptocurrencies in terror financing and a commitment to disrupting these networks globally.

“The world watched in horror as Hamas committed brutal acts of terrorism against the people of Israel,” said U.S. Senator Sherrod Brown (D-OH), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs. “On this committee, we’ve raised the alarm about crypto and its role in illicit finance—including the use of crypto to both fund terrorists and enable the rogue nations financing them… when law enforcement attempts to trace or block crypto funds, it becomes a game of whack-a-mole. They stop one transaction…and the criminals have moved on to another platform, with another alias.”

Forbes recently reported on Israeli startup Lionsgate Network, which has been effective in identifying and intercepting cryptocurrency accounts linked to Hamas. Specifically, Lionsgate was successful in finding and freezing about $90 million worth of cryptocurrency owned by Hamas, involving approximately 100 accounts. This action represents a significant step in the joint efforts of U.S. authorities and Israeli intelligence to disrupt the financial mechanisms used by Hamas for terrorism financing.

Challenges and Future Trends

The adaptability of terrorist groups like Hamas in exploiting digital currencies presents ongoing challenges. Future trends may see an increase in the use of privacy-centric cryptocurrencies, underscoring the need for advanced intelligence capabilities and international cooperation to effectively counter these threats.

Conclusion: Need for Vigilance and Strategic Collaboration

Understanding Hamas's evolving tactics in cryptocurrency use, contextualised within the geopolitical landscape and countered by Israeli intelligence, is vital for a comprehensive global security strategy. Continuous vigilance, strategic foresight, and collaboration are essential in addressing the multifaceted challenges of modern terrorist financing.

References and Essential Further Reading:



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