In a sharp rebuttal to accusations that Palestinian group Hamas raised tens of millions of dollars in crypto to finance its attacks against Israel, blockchain surveillance firm Elliptic has argued that there is “no evidence” to corroborate those claims.
“There is no evidence to support the assertion that Hamas has received significant volumes of crypto donations,” Elliptic has said in its latest report. Elliptic’s findings reveal that the funds raised were “tiny.”
Crypto’s role in terrorist financing comes under scrutiny
The remarks are in sharp contrast to the many articles and letters swirling around cryptocurrency’s alleged role in funding Hamas’ “terrorist” activities. For instance, a report by The Wall Street Journal falsely claimed that Hamas and Palestinian Islamic Jihad had received crypto donations worth more than $130 million between August 2021 and June 2023.
However, the WSJ later made a U-turn on its assertions, with the revised figures standing at $93 million. What’s most disturbing about this is not the WSJ’s negligence but that it made its way to the White House and the US Department of the Treasury.
US lawmakers argue crypto is a ‘threat’ to national security
Scores of US lawmakers — including Elizabeth Warren — argued in a letter that crypto “poses a security threat” to Washington and its allies. Citing the WSJ article, the lawmakers called on Congress and the Biden administration to take “strong action” to mitigate the risks associated with cryptocurrency financing illegal activities before it leads to another “tragedy”.
Gross misinterpretation of data
However, Elliptic says the figures provided by the WSJ were wrong and its data distorted. “Over the past two weeks, politicians and journalists have portrayed public crypto fundraising as a significant source of funds for Hamas and other terrorist groups, but the data simply does not support this,” the crypto sleuth said.
As a case in point, Elliptic referred to a “prominent” Hamas cryptocurrency fundraising campaign, which is currently administered by Gaza Now, a pro-Hamas news outlet. This campaign has raised just $21,000 in cryptocurrency since the onset of the Israel-Hamas conflict on October 7. Of these, about $9,000 was seized by stablecoin issuer Tether, and another $2,000 was directed to a crypto exchange.
In April, Hamas announced it would no longer accept donations made in Bitcoin, citing “concern about the safety of donors.” Meanwhile, several crypto wallets and exchange accounts linked to Hamas have been frozen by Israel since 2021.
Israel targets Hamas-linked crypto accounts to choke funding
Earlier this month, Israeli authorities seized over 100 crypto accounts tied to Hamas—claiming the Palestinian group was using these accounts to shore up funds to continue its attack on Israel.
Elliptic argues the developments signal the “weakness of crypto as a terrorism fundraising tool.” It also notes that blockchains like Bitcoin and Ether create a trail of transactions, which allows illicit funds to be tracked.