HomeLatest NewsHamas' Cryptocurrency Maze Targeted by Israel: Reuters Report

Hamas’ Cryptocurrency Maze Targeted by Israel: Reuters Report

The Financial Web of Palestinian Militant Group Hamas

Hamas’ Global Financing Network

According to experts and officials, the Palestinian militant group Hamas utilizes a global financing network to receive support from charities and friendly nations. They employ various methods such as passing cash through Gaza tunnels and using cryptocurrencies to bypass international sanctions.

Hurdles in Accessing Funds

However, the recent violence by Hamas gunmen, resulting in the deaths of hundreds of Israelis, mainly civilians, has created additional obstacles for the group to access funds. In response, Israel has launched the most intense bombardment of Gaza in 75 years of conflict.

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Israeli Crackdown on Hamas’ Financing

Last week, Israeli police announced the freezing of a Barclays bank account linked to Hamas fundraising and blocked cryptocurrency accounts used for gathering donations. Although the exact number of accounts and the value of the assets were not disclosed, this move sheds light on the complex financial web that supports Hamas and its government in the Gaza Strip.

Hamas’ Funding Sources

Matthew Levitt, a former U.S. official specialized in counterterrorism, estimated that the majority of Hamas’ budget, exceeding $300 million, comes from taxes on businesses, support from countries like Iran and Qatar, and donations from charities. Last February, the State Department revealed that Hamas raises funds in other Gulf countries and receives donations from Palestinians, expatriates, and its own charities.

Hamas’ Use of Cryptocurrencies

Hamas, designated as a terrorist organization by the United States and countries like Britain, has increasingly turned to cryptocurrencies, credit cards, and contrived trade deals to evade mounting international restrictions. However, earlier this year, Hamas announced its decision to distance itself from crypto after suffering losses, as the traceable nature of cryptocurrency transactions posed a risk.

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Israeli Actions and Hamas’ Diminished Crypto Donations

Following the recent violence, Israeli authorities have been quick to target Hamas-linked support groups, resulting in a decrease in crypto donations. TRM Labs, a blockchain research firm, reported that despite the previous surge in crypto fundraising after conflicts, the volume of donations has been low since the recent violence. Israeli authorities have seized tens of millions of dollars in cryptocurrency from Hamas-linked addresses over the years.

Alternative Means of Funding

Hamas’ allies, such as Iran, have found alternative ways to provide financial support to Gaza, including methods like shell companies, shipping transactions, and precious metals. Iran, which provides up to $100 million annually to Palestinian groups, did not respond to a request for comment. Qatar has also played a significant role, offering hundreds of millions of dollars in aid to Gaza since 2014, primarily for electricity, needy families, and public servants.

Qatar’s Coordinated Aid

Qatar’s funding for Gaza is coordinated with Israel, the UN, and the U.S. The funds are electronically transferred from Qatar to Israel, and Israeli and UN officials physically carry the cash over the border to Gaza. The cash is then distributed directly to needy families and public servants, with records kept by Israel, the UN, and Qatar.

Challenges for Restricting Hamas’ Access to Formal Financial Channels

Restricting Hamas’ access to formal financial channels is a challenge, as their financing tactics have evolved to circumvent such restrictions. Stephen Reimer of the think tank Royal United Services Institute predicts limited success in fully cutting off Hamas’ financial resources.

It is crucial to understand the complex financial web that supports Hamas and its government in the Gaza Strip. By exploring their global financing network, the methods they employ, and the challenges they face, we can gain insight into the dynamics of this militant group’s funding.

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