“Who funds Hamas?” — The question that is making headlines right now, received many claims from mainstream media that Palestinian militant group Hamas gathered $130 million in funds using cryptocurrencies. A report shows that these numbers maybe highly exaggerated.
Who Funds Hamas? Are They Using Cryptocurrencies?
The global community has been abuzz with controversial headlines suggesting substantial cryptocurrency funding funneled towards Hamas. The militant group has been in the limelight due to its activities following the events of October 7, 2023 by launching a major attack against Israel. But how much of these headlines reflect the actual state of affairs?
Hamas, the de-facto ruling authority of the Gaza Strip in Palestine is regarded by many countries as a terrorist organization.
Elliptic’s Stand: Dispelling the Myths
On October 25, 2023, Elliptic, a blockchain analytics firm, took a stand to demystify the prevailing narrative. Their statement was a direct response to the burgeoning claims “that crypto wallets linked to Hamas and Palestinian Islamic Jihad collectively received more than $130 million in digital assets in the two years before the attack, including millions in the months leading up to it.”
The True Numbers: A Deep Dive into the Data
According to Elliptic’s own article, “only $21,000 in cryptocurrency has been donated since October 7th, and thanks to the efforts of crypto businesses and researchers, much of this has been frozen – preventing Gaza Now from being able to use these funds.
“Gaza Now” is a pro-Hamas news organization that has been conducting the most significant public cryptocurrency fundraising campaign for this group since the October 7th attacks.
On October 9th, Gaza Now sent around $2,000 of the donated cryptocurrency to an exchange, presumably to cash-out, where it was promptly frozen. In addition, around $9,000 in stablecoin donations were frozen by Tether, the stablecoin’s issuer.
This is a huge disparity from the numbers shown in the WSJ article claiming hundreds of millions in crypto has been funneled to Hamas and organizations linked closely with them.
An op-ed in The Hill goes even further pointing out not only did Hamas not raise the funds the WSJ article claimed but “Israeli law enforcement successfully located and froze multiple cryptocurrency accounts that Hamas had used to solicit donations. Israel then funneled the assets into its own treasury.”
Related reading: Canadian Truckers Use Bitcoin Crowdfunding To Fuel Freedom Protest
Striking the Balance: Privacy vs. Security
While Bitcoin offers a new level of privacy for its users, it doesn’t equate to anonymity. The transparent nature of blockchain technology offers a potent tool for law enforcement to track and combat illicit financial activities.
The challenge lies in finding the right balance: preserving privacy and financial autonomy while ensuring that cryptocurrencies are not misused for nefarious purposes. As technology evolves, so too will the strategies to ensure its beneficial use for society.
Related reading: The Ethics Of Mixing Bitcoin
For individuals skilled enough to obfuscate their digital trail, trade peer-to-peer, and utilize advanced privacy technologies, remaining hidden within the vast crypto network becomes plausible.
Consider Bitcoin’s creator, Satoshi Nakamoto. Despite the profound impact of his invention on the financial world and the countless attempts to uncover his identity, Satoshi remains unknown. This demonstrates that while blockchain is transparent, it isn’t inherently revealing.
Transparency vs. Accountability
However, there’s a twist to Bitcoin’s narrative. Every transaction made on the Bitcoin network is recorded on a public ledger called the blockchain. This means the network offers unparalleled levels of transparency but can also become a tool for surveillance and control if the end user is not careful.
Terrorist Financing and the Blockchain Paradox
Hamas’s experience serves as a cautionary tale to other entities who might also try and use cryptocurrency to fund themselves.
By exposing a public key to accept bitcoin donations, they inadvertently allowed anyone in the world to audit them. When Hamas attempted to move their bitcoin to an exchange it resulted in the freezing of their assets. This incident highlights the inherent transparency of blockchain technology, which enabled law enforcement to monitor and act upon Hamas’s financial maneuvers effectively.
There Are No Winners In War
In the midst of conflict, the gravest toll is often borne by innocent civilians caught in the crossfire. It is the hope of every rational individual untouched by the blinding thirst for revenge to witness a peaceful resolution to such a volatile situation.
It is imperative during these times for individuals to remain skeptical and not be swayed by the chaos of conflict. Senator Marshall and Warren’s article not only misses the mark factually but also seems to exploit a dire situation to advance a political narrative against cryptocurrency in the United States. Such use of a crisis is deeply troubling and counterproductive.