In the wake of recent attacks by Hamas on Israel, law enforcement authorities have intensified their efforts to sever ties between cryptocurrency markets and the militant group. Over 100 accounts on Binance, one of the largest crypto exchanges globally, have been shut down with information on an additional 200 accounts being pursued.
On Tuesday, Tom Alexandrovich from the Israel National Cyber Directorate voiced concerns over the increased use of cryptocurrencies for terrorist financing during conflicts, as per a Financial Times report. In compliance with international sanctions rules, Binance has blocked several accounts while Tether, a popular stablecoin, has frozen 32 addresses linked to terrorism in Israel and Ukraine.
Since October 7, Israeli authorities have identified roughly 150 Hamas-related donation initiatives, many promoted through social media posts. An anonymous Binance employee shed light on the difficulties the company faces in tracking customer exposure to these donation addresses.
The US regulator, Commodity Futures Trading Commission (CFTC), had previously associated Binance with Hamas transactions. The complexities of combating digital terror financing were underscored by Israeli defence minister Yoav Gallant and echoed by the Financial Stability Board, which is currently developing a framework to address terrorist financing in crypto assets.
Analytics firm Elliptic observed that suspicious groups in the Middle East frequently transact cryptocurrencies among each other before converting them into sovereign currencies. This revelation comes as Israeli officials were already monitoring suspected crypto accounts linked to terrorism, supported by a volunteer task force and public assistance.
These measures demonstrate an escalating global effort to curb the misuse of cryptocurrencies for illicit activities. As digital currencies become more integrated into our financial systems, the challenge to ensure their safe and legal use remains a top priority for regulators worldwide.
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