How Much Money Are Terrorists Actually Raising in Crypto?

The recent Wall Street Journal article that claimed Hamas raised $130 million via cryptocurrency has sparked considerable debate, especially after Sen. Elizabeth Warren used it as her sole source to ask for tighter regulations around crypto. However, the veracity of this claim has come under scrutiny.

Yaya Fanusie, Jessi Brooks, and Andrew Fierman delve into the veracity of reported figures, the methodology behind them, and the subsequent industry responses that sought to correct the public record. They examine the political implications of cryptocurrency, its use in funding organizations, and the nuanced role of stablecoins in this digital economy. Additionally, they address the broader challenges in regulating crypto to prevent illicit funding, emphasizing the need for factual accuracy and a comprehensive approach to understanding and tackling such complex issues.

Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform.

Show highlights:

• how the Wall Street Journal article claimed that Hamas and other militant groups in Palestine raised $130 million via crypto
• why Yaya, who spent some time in his career doing research on terrorist financing, found those numbers odd
• why Jessi believes that there’s been a loss of focus on facts and accuracy
• Andrew’s explanation of the post by Chainalysis that corrected the record
• why it’s so difficult to make a confident assessment of how much money is being funneled to terrorist groups
• whether crypto has become politicized
• why is it so important to focus not only on the crypto fundraising but also the other avenues, according to Jessi
• the role of USDT and other stablecoins in fundraising terrorist organizations
• how North Korea is a much more sophisticated actor than Hamas in its know-how about crypto
• how the government has tried to respond to the illicit usage of crypto, such as the OFAC sanctions on Tornado cash
• the challenges to creating regulations to prevent the use of illicit activity in crypto

Thank you to our sponsors!

• Crypto.com
• LayerZero
• Popcorn Network

Guests:

• Yaya Fanusie, Director of anti-money laundering and cyber risk at the Crypto Council for Innovation
  • Previous appearance on Unchained: How Widespread Is Money Laundering in Crypto?
  • Hamas has been experimenting with crypto for years: Yaya Fanusie, appearance on FOX Business
• Jessi Brooks, CCO and Legal Officer at Ribbit Capital
  • Previous appearance on Unchained: How This DOJ Strike Force Hunts Down Cryptocurrency Criminals
• Andrew Fierman, Head of Sanctions Strategy at Chainalysis

Links

Fundraising report and corrections:

• WSJ:
  • Hamas Militants Behind Israel Attack Raised Millions in Crypto
  • Cryptocurrency Feeds Hamas’s Terrorism
  • Questioning Two Senators on Crypto Terrorism
• Washington Post: 
  • U.S. to warn crypto firms against financing Hamas, terror groups
  • U.S. Cyber Command helps prosecutors seize stolen cryptocurrency traced to illicit N. Korea nuclear weapons program
• FT: Israel orders freeze on crypto accounts in bid to block funding for Hamas
• Fortune: Stricter verification laws in the U.S. won’t stop international terrorists from using crypto
• DOJ: Global Disruption of Three Terror Finance Cyber-Enabled Campaigns
• Elliptic:
  • Setting the record straight on crypto crowdfunding by Hamas
  • How Hamas has utilized crypto, and what may be coming
• Chainalysis:
  • Cryptocurrency and Terrorism Financing: Correcting the Record
  • DOJ Takedowns Terrorism Financing with Blockchain Analysis

Tornado Cash sanctions: 

• Bitcoin News: Snoop Dogg, Steve Aoki, Logan Paul, and Beeple Dusted by OFAC-Banned Tornado Cash Transactions
• Previous coverage of Unchained on Tornado Cash:
  • Is This the End of DeFi? Why the US Government Is Going After Tornado Cash
  • The Chopping Block: ‘Code Is Law’ Is ‘Obviously Not How Anything Works Ever’
  • The Chopping Block: Why DeFi May Be Over-Complying With Tornado Cash Sanctions
  • Preston Van Loon on Ethereum’s Merge and His Lawsuit Against Treasury
  • Given the Sanctions on Tornado Cash, Is Ethereum Censorship Resistant?
  • The Chopping Block: Did OFAC Overstep by Sanctioning Tornado Cash?
  • Tornado Cash Sanctioned. Did the Government Overstep Its Bounds?
• Unchained: Tornado Cash Cofounder Arrested, Another Sanctioned by U.S. Government

Crypto anti-money laundering bill:

• Warren’s letter: Warren, Marshall, Casten, 100+ Lawmakers Ask Biden Administration to Address Crypto-Financed Terrorism after Reports of Hamas Raising Millions in Crypto to Fund Operations
• The Digital Asset Anti-Money Laundering Act of 2023 Senators Elizabeth Warren and Roger Marshall

CoinDesk: Senator Elizabeth Warren’s Crypto Money Laundering Bill Gains Momentum as More Sign On