July 14, 2021 | FDD's Long War Journal

Cryptocurrency intended for Hamas seized by Israel

July 14, 2021 | FDD's Long War Journal

Cryptocurrency intended for Hamas seized by Israel

On July 7, Israel Defense Minister Benny Gantz signed an administrative seizure order for the cryptocurrency wallets and addresses used by Hamas to funnel funds to the militant group.

“Pursuant to my authority according to section 56(b)(1) and 56(b)(2) of the Anti-Terrorism Law 5776 – 2016, and having been convinced that the cryptocurrency wallets and addresses of the funds in the list attached to this order are the property of the designated terrorist organization HAMAS, or property used for the perpetration of a severe terror crimes as defined by the law; I hereby order the temporary seizure in order to confiscate it in accordance with section 66 of The Law,” the document stated.

Citing a senior Hamas official, The Wall Street Journal reported in June a “spike” in bitcoin donations to Hamas during the conflict against Israel and that “some of the money gets used for military purposes [al-Qassam Brigades] to defend the basic rights of the Palestinians.”

Militant groups have favored cryptocurrency due to the anonymity it provides the sender and receiver in a transaction. It allows the opportunity to circumvent international laws and sanctions that are in place against funding terrorism.

Hamas announced in 2019 their intention to establish a mechanism for supporters to donate cryptocurrency to the group. A short time later, its web site setup a link for supporters to transfer donations. The site also offered a video tutorial in several different languages on how to donate to the group.

However, this effort caught the attention of the U.S. Department of Justice who covertly took over the website, intercepted funds directed to Hamas, and subsequently shut it down.

“With judicial authorization, law enforcement seized the infrastructure of the al-Qassam Brigades websites and subsequently covertly operated alqassam.net. During that covert operation, the website received funds from persons seeking to provide material support to the terrorist organization, however, they instead donated the funds bitcoin wallets controlled by the United States,” a Department of Justice press release stated.

Additionally, Hamas isn’t the only militant group in the Gaza Strip to use cryptocurrency. Groups such as Jaysh al-Ummah and al-Aqsa Martyrs Brigades have used Telegram to appeal to supporters for donations to wage jihad against Israel.

Although the U.S. and Israeli governments have had some success in shutting down Hamas’ cryptocurrency network in the past, the group has quickly recovered from the seizures by reestablishing its website under a different domain name and continuing to request Bitcoin from supporters. The most recent being a week after the May conflict ended, when the group appealed to its supporters via its Telegram channel to visit its website and donate.

Joe Truzman is a contributor to FDD’s Long War Journal. Follow Joe on Twitter @Jtruzmah. Follow FDD on Twitter @FDD and @LongWarJournal and @FDD_CMPP. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.

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Issues:

Blockchain and Digital Currencies Israel Military and Political Power Palestinian Politics The Long War U.S. Defense Policy and Strategy