The US Justice Department has confiscated over $200,000 in cryptocurrency purportedly aimed to support the militant group Hamas, as announced in a statement on March 27.
The cryptocurrency, totaling $201,400, was linked to fundraising accounts believed to be under Hamas’s control and was reportedly used to launder more than $1.5 million in digital currencies since October 2024.
This laundering process involved numerous “virtual currency exchanges and transactions,” utilizing suspected financiers and over-the-counter brokers, according to the Justice Department. The assets are currently secured across at least 17 wallets.
In January 2024, the US Treasury’s Office of Foreign Assets Control, alongside similar agencies in the United Kingdom and Australia, implemented sanctions against networks and facilitators conducting cryptocurrency transactions associated with Hamas. These actions were based on earlier US Treasury sanctions enforced in October 2023.
Around the same time, three families of victims from a Hamas attack on Israel initiated legal action against Binance and its former CEO Changpeng Zhao, claiming that the exchange had provided significant support to terrorists. In court, an attorney for Binance asserted that the exchange had “no special relationship [with] Hamas.”
The exchange has been under scrutiny from the US government for alleged deficiencies in its anti-money laundering protocols. In November 2023, Binance reached a settlement with the Justice Department amounting to $4.3 billion.
Is More Regulation Necessary?
A December 2024 report indicated that Hamas has been attempting to collect cryptocurrency donations since at least 2019, though the “scale and effectiveness” of these initiatives remains ambiguous.
The use of cryptocurrency for fundraising by terrorist organizations has increasingly caught the attention of US officials, some of whom believe that enhanced oversight or regulation may be necessary to curb such activities.
A 2023 Chainalysis report noted that financing for terrorism through cryptocurrency constitutes a minor fraction of crypto transactions, as illegal entities typically favor traditional, fiat-based means for funding their operations.