Although cryptocurrency is still a relatively new innovation in the financial industry, its use is growing among Jihadist groups in the Middle East. A recent report by the JITM (MEMRI Jihad and Terrorism Threat Monitor) shows that funding terrorism with cryptocurrencies is on the rise.
Crypto and Terror-Financing
The long report prepared by JITM was summarized by Middle East Media Research Institute (MEMRI) on August 21, titling it “The Coming Storm”. The report claims that terrorists, their organizations and supporters are using cryptocurrencies in different ways including funding attacks, purchasing equipment, supporting fighters, their families and more.
As the awareness around cryptocurrencies is rising, bad players are undeniably becoming a threat to the growth of the industry. Every discussion on regulating cryptocurrencies includes the topic of the controversial feature of anonymity associated with cryptocurrency transactions. This feature is presently being leveraged by the terrorist groups. The study report of MEMRI writes;
The blockchain and cryptocurrency industry continues to gain momentum, and more and more companies allow the use of cryptocurrencies and even launch their own, it is understood, and expected, that criminal elements, including terrorist groups, will move even more quickly than they are today to use them.
The extensive research of five years details that a jihadi blog helps terrorism groups via a bitcoin online donation that eventually sends the cryptocurrency to ISIS, the Muslim Brotherhood, Hamas, Al-Qaeda, etc. Besides the blog, a few terrorist groups solicit donations in the form of cryptocurrency on social media networking sites including Facebook, Twitter, and others. In fact, Telegram is believed to be the main platform being used for terrorist fundraising today according to research. The study points out that the terrorist groups also share instructive video clips along with bitcoin addresses to guide potential donors. Bitcoin, Dash, Ethereum, Monero, Verge, Zcash are a few major cryptocurrencies that terrorists often receive as a donation. The report says;
This landmark study shows undeniably that the future of terrorist funding and fundraising is happening now. The threat is too important to overlook; it must be researched and solutions must be arrived at.
Telegram used extensively for funding terrorism
The study also reveals that social media networks are the center spots to finance terrorist groups and urges for clear policies on banning/restricting criminal cryptocurrency activity on such platforms. It further mentions that “they can prevent these acts by “repercussions and penalties for companies that do not do so”.
The research points a serious warning towards Telegram’s upcoming cryptocurrency, GRAM with the blockchain TON. It also claims that no tools have been developed to tackle cryptocurrency fundraising used by terrorist and jihadi groups. It asserts;
Counterterrorism officials need to be prepared for the coming explosion of terrorist use of Telegram’s cryptocurrency.
While Telegram is becoming a major spot to help Jihadis and supporters with crypto funding, the research states that MEMRI staff issued congressional letters to Telegram CEO Pavel Durov. The letter requested Mr. Durov’s immediate response to the widespread use of his platform by terrorists. The research explained that the letter demanded;
Inter alia, that Durov “respond… with immediate urgency specifying a plan of action to combat extremist content on Telegram and create safeguards to prevent terrorist groups from using the platform as a secure fundraising tool.”
As reported earlier, cryptocurrency’s nature of decentralization and anonymity have led terrorist groups to turn to Bitcoin and the report that states no action has been taken to put an end to its use by bad players. Moreover, the report names a few major terrorist groups that are using crypto financing and are majorly promoting it via Twitter, Instagram and Telegram to solicit cryptocurrency, especially bitcoin for fundraising.
According to the detailed report, pro-ISIS groups, the Al-Qaeda affiliate Hay’ at Tahrir Al-Sham (HTS), Hamas’s military wing, the Izz Al-Din Al-Qassam Brigades, and their support groups are majorly involved in crypto-financing. Also, the study states that these groups “apparently disappear” once they begin receiving attention from the media and legal watchdogs.
During the research for this report, it was found that some groups, after receiving attention from media and authorities, apparently disappeared, along with their cryptocurrency wallets and addresses.
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