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Israeli Police Freeze Hamas Crypto Accounts

3 mins
Updated by Geraint Price
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In Brief

  • Israeli police have seized cryptocurrencies belonging to the Hamas militant group, which carried out a deadly attack on Israel on Saturday.
  • The militant group allegedly solicited crypto donations from its supporters through social media channels after its major attack on Israel.
  • The US has moved military equipment and personnel closer to Israel to stop Hamas supporter Iran from becoming actively involved in the war.
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Israeli police have seized crypto accounts belonging to Palestinian militant group Hamas in the wake of the group’s recent attacks. Hamas allegedly directed funding it received through social media to custodial wallets on an exchange.

Lahav 433, a local organization resembling the US Federal Bureau of Investigation (FBI), conducted the seizure with assistance from Binance. After the discovery, police transferred funds from Hamas’ wallets to the Israeli government treasury.

Binance Under Scrutiny Again

According to police, Hamas allegedly solicited crypto donations after launching its offensive against Israel on Saturday. The group later routed funds raised through its social media channels to custodial wallets on an exchange.

“As the war broke out, Hamas launched a fundraising campaign on social networks, asking the public to deposit crypto coins into its account. The cyber and foreign exchange unit worked immediately to locate and freeze the accounts, assisted by the Binance crypto exchange,” a police spokesperson said.

Israeli and UK police have also tracked down a British bank account Hamas used to solicit additional funding. 

“The Israeli police, the military and other partners will continue to fight terrorist financing and damage the strategic financial assets of terrorist organizations,” the spokesperson added.

Binance co-founder He Yi said that Binance’s cooperation with Israel was apolitical and applied only to Hamas and not the entire region of Palestine. The exchange could not refuse the law enforcement request, given the United Nations’ designation of Hamas as a terrorist group.

Last year, Israeli police seized funds in Binance accounts they believed belonged to Hamas. Binance rebuffed a related Reuters report for allegedly misrepresenting its counter-terrorism financing measures.

In March, the US Commodity Futures Trading Commission (CTFC) filed a lawsuit against Binance, suggesting a lax approach to detecting criminal activity. No criminal charges have been filed against the exchange so far.

Read more: Binance Review 2023: Is It the Right Crypto Exchange for You?

Hamas launched its first deadly attack on Israel since 1948 on Saturday, killing more than 1,500 citizens and taking at least 100 hostage. Citizens have called on the government to launch a ground offensive, a move that could lead to instability in the Gaza strip, a Palestine region from which Hamas launched its attack.

Israel Crypto Hamas, Map of Hamas attacks on Israel
Hamas attacks on Israel | Source: Financial Times

Complicating the conflict is Iran’s backing of the Axis of Resistance, a group including Hamas whose sole focus is to exterminate Israel. Iran’s UN mission has said, however, that while it supports Palestine, the Hamas attack was carried out “solely by Palestine itself.”

Regardless, the US has decided to move an aircraft carrier strike group and military aircraft closer to Israel, in part, to deter Iran. Several Western powers, including the US, have sanctioned Iran because of its uranium enrichment program, believed to be a precursor to nuclear armament.

Last year, a Reuters report suggested that Binance allowed Iran to use its platform to bypass US sanctions established in 2018. Binance said it liquidated all accounts belonging to Iranians in the same year, a claim some Iranian users disputed.

Last year, Kraken, another major exchange, settled with US Office of Foreign Assets Control (OFAC) for allegedly allowing 1,500 Iranians to use its platform despite sanctions. The exchange paid the regulator a settlement of $360,000 with a $100,000 add-on.

Read more: Kraken Review 2023: A Review of Its Security, Fees, and Features

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David Thomas
David Thomas graduated from the University of Kwa-Zulu Natal in Durban, South Africa, with an Honors degree in electronic engineering. He worked as an engineer for eight years, developing software for industrial processes at South African automation specialist Autotronix (Pty) Ltd., mining control systems for AngloGold Ashanti, and consumer products at Inhep Digital Security, a domestic security company wholly owned by Swedish conglomerate Assa Abloy. He has experience writing software in C,...