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US Financial Services Committee Heightens Concerns Over Digital Assets and Terrorism

2 mins
Updated by Kyle Baird
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In Brief

  • The US Financial Services Committee raises alarms about Hamas using digital assets for funding illicit operations.
  • Urging President Biden to take swift action, the committee cites conflicting reports on Hamas's fundraising via blockchain analytics. Congress seeks clarity on the scale and success of seizing illicit digital assets.
  • Disclosing financial data, the committee notes that Hamas-linked wallets received $41 million, while Palestinian Islamic Jihad wallets received around $93 million from August 2021 to June 2023.
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The United States Financial Services Committee has written to US President Joe Biden over concerns that Hamas is utilizing cryptocurrency to conduct illicit activities.

“We write today to raise serious concerns about Hamas, a designated terrorist organization by the United States, and its ability to utilize digital assets to finance its operations,” the letter stated.

Committee Points To Digital Assets Use In Terrorism

According to the letter, the committee urges the president to take digital assets used in terrorism seriously. This comes after having received data information from blockchain analytics companies:

“This is particularly critical given the conflicting reports we have on Hamas’s fundraising campaign from blockchain analytics firms.2 Congress must understand the size, scope, and duration of Hamas’s digital asset operations, as well as whether the United States has had success in seizing illicit digital assets.”

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It further states that wallets linked to the organization received approximately $41 million in digital assets. Furthermore, Palestinian Islamic Jihad-linked digital wallets received approximately $93 million between August 2021 and June 2023.

However, it was only recently that BeInCrypto reported on findings that terrorism financing is primarily conducted in fiat.

Screenshot from US Treasury report highlighting BTC. Source: X/@zerohedge 
Screenshot from US Treasury report highlighting BTC. Source: X/@zerohedge 

Speaking to BeInCrypto, a chain analyst said:

“Terrorism financing is a very small portion of the already very small portion of cryptocurrency transaction volume that is illicit.”

Senator Elizabeth Warren Issues Recent Warnings

Meanwhile, the report highlighted that crypto inconveniences terrorist financing due to its transparency on blockchains.

Senator Elizabeth Warren recently warned against this. Warren stated there is a “danger of crypto-financed terrorism is real and should be an urgent priority for Congress.”

“There’s a growing bipartisan coalition of senators who are committed to passing this bill. and fighting back against terrorism worldwide by choking off the financing.”

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Ciaran Lyons
Ciaran is a cryptocurrency journalist based in Sydney, Australia. He particularly enjoys writing about CBDC developments and the practical implementations of cryptocurrency in real-world scenarios. He has also appeared across major television networks in Australia including Channel Ten, Channel Nine and SBS TV. Prior to his foray into cryptocurrency, Ciaran worked as a presenter on national radio station Triple J.