In the middle of escalating tensions between Israel and Hamas, over 100 legislators, led by Senators Elizabeth Warren and Roger Marshall and Representative Sean Casten, have issued a bipartisan note urging the Biden administration to address alleged close relations between crypto and terrorism.
The lawmakers express alarm over reported evidence suggesting that Hamas successfully evaded US sanctions, acquiring millions of dollars through crypto assets. They are now pressing the administration to clarify its strategy for tackling this critical national security threat.
Lawmakers Sound Alarm On Crypto-Financed Terrorism
The bipartisan letter, addressed to National Security Advisor Jake Sullivan and Brian Nelson, Under Secretary for Terrorism and Financial Intelligence at the Department of the Treasury, highlights the concerns surrounding Hamas and Palestinian use of crypto funding.
The letter states that between August 2021 and June of the following year, these organizations allegedly raised over $130 million in digital assets, with millions being transferred between them.
The lawmakers stress the urgency of the situation, given the danger posed by the financing of militant organizations, and call on the Biden administration to provide details about its plan to prevent the use of crypto for terrorism financing.
In their letter, the lawmakers cite an article from the Wall Street Journal, which reports that researchers studying Hamas’s financing allegedly confirm that crypto remains one of several tools employed by the group to raise funds.
While it has not been determined whether the crypto received by Hamas directly financed the October 7th terrorist attack on Israel, the group’s explicit solicitations for crypto have left no doubt about their intentions.
Furthermore, the lawmakers highlight that both the Israeli and US governments have previously warned about the threat posed by crypto in the fight against terrorism. Israel has even seized crypto assets from terrorist organizations like Hamas and Hezbollah.
However, experts believe that only a fraction of the digital asset funds flowing through Hamas have been successfully captured.
Urgent Call To Curtail Alleged Illicit Activity
In light of this, the lawmakers call for decisive action to address the risks associated with illicit crypto activity to prevent further tragedies.
As Congress considers legislative proposals to mitigate alleged money laundering and illicit finance risks, they urge the Biden administration to swiftly and comprehensively act to curtail such activities and safeguard national security, as well as the security of US allies.
The lawmakers have set a deadline of October 31, 2023, for the Treasury and the Biden administration to respond to questions about their plans to address the serious national security threats arising from using crypto to finance terrorism.
As the debate surrounding the regulation of digital assets continues to intensify, the alleged crypto-financed terrorism adds another layer of complexity.
Featured image from Shutterstock, chart from TradingView.com