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US Demands Action Plan to Prevent Crypto Terrorism Funding

US Demands Action Plan to Prevent Crypto Terrorism Funding

A group of more than one hundred US lawmakers, including Senator Elizabeth Warren, has joined forces to demand transparency and clarity from the Biden administration regarding its strategy to combat the utilization of cryptocurrency by terrorist organizations. The lawmakers expressed concerns over recent reports suggesting that the militant group Hamas had resorted to cryptocurrency to finance its activities, especially in the context of the escalating conflict with Israel. In this article, we delve into the lawmakers’ call for action, highlighting the potential threats posed by crypto financing to national security.

The Growing Concern

Recent reports have raised concerns about the employment of cryptocurrencies by Hamas as a means to raise funds for its operations. The letter from the lawmakers emphasizes that Hamas has emerged as one of the most adept users of cryptocurrencies in the realm of terror financing, underlining the gravity of the situation.

The Letter to National Security Advisor Jake Sullivan and Under Secretary Brian Nelson

The lawmakers have directed their inquiries to National Security Advisor Jake Sullivan and Under Secretary for Terrorism and Financial Intelligence at the Treasury, Brian Nelson. Their letter seeks answers to several critical questions aimed at comprehending the Biden administration’s approach to combating the use of crypto by terrorist organizations.

Key Questions Raised

Strategy Against Crypto Usage by Terrorist Organizations – The lawmakers are keen to understand the Biden administration’s strategy to combat the use of cryptocurrency by terrorist groups. This inquiry reflects their growing concerns about the potential risks this poses to national security.
Quantifying Funds Raised – Another critical point of inquiry revolves around the exact amount of funds raised through cryptocurrencies by Hamas and the Palestinian Islamic Jihad. The Wall Street Journal’s report estimates that these groups collectively raised approximately $130 million worth of cryptocurrencies between August 2021 and June 2023.

Effectiveness of Crypto Tracking

Blockworks’ Insight: Experts interviewed by Andrew Thurman at Blockworks have shed light on the practicality of tracking cryptocurrencies employed by organizations like Hamas for fundraising. Despite the perceived anonymity of cryptocurrencies, law enforcement agencies have generally been successful in freezing crypto assets held by these groups.

International Collaborative Efforts

In a recent development, Israel, with assistance from UK law enforcement and Binance, successfully froze Hamas-linked donation accounts. Furthermore, Tether, a major cryptocurrency, took proactive steps by freezing approximately 32 wallets suspected of having ties to terrorism and warfare.

Hamas’s Stance on Crypto

Earlier this year, Hamas announced the suspension of its bitcoin fundraising efforts, citing concerns about the safety of its donors, as reported by Reuters.

US Treasury’s Risk Assessment

In early 2022, the US Treasury Department released a risk assessment stating that the use of virtual assets by terrorists remained limited when compared to other financial products and services. However, the recent activities of groups like Hamas have heightened concerns among lawmakers.

Conclusion

The letter from over one hundred US lawmakers to key administration figures underlines the pressing need for a robust strategy to prevent the misuse of cryptocurrencies by terrorist organizations. As cryptocurrency continues to gain prominence, the risks associated with its potential for illicit financing cannot be ignored. The Biden administration is now under scrutiny to address these concerns and ensure that the nation’s security remains intact in the digital age.

The post US Demands Action Plan to Prevent Crypto Terrorism Funding appeared first on FinanceBrokerage.

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