Recent attacks orchestrated by Hamas on Israel have shed light on the alarming use of cryptocurrency by militant groups to fund their operations. Between August 2021 and June 2023, Hamas, along with Palestinian Islamic Jihad (PIJ) and Hezbollah, amassed a staggering $134 million in cryptocurrency, according to Israeli government seizure orders and blockchain analytics reports reviewed by The Walls Street Journal.&nbsp; 
The WSJ reports that the funds, primarily collected from donors, have bypassed the traditional banking system, leveraging the cloak of anonymity that cryptocurrencies provide. 
Hamas alone received approximately $41 million in digital currency. The Gaza Strip militants, under PIJ, who joined forces with Hamas over the weekend assault, garnered a notable $93 million in cryptocurrency.&nbsp; 
Furthermore, crypto funds belonging to Hezbollah were seized from crypto exchange Binance in June, although the exact amount remains undisclosed. Binance, in partnership with Israeli police, has frozen crypto accounts allegedly used by Hamas for fundraising, Cryptopolitan <a href="https://www.cryptopolitan.com/binance-israeli-police-stop-hamass-crypto-donations-amid-rising-conflict/">reported</a>.&nbsp; 
Binance has affirmed its ongoing efforts to prevent terrorist groups from accessing crypto resources.&nbsp; 
<h2 class="wp-block-heading" id="regulatory-bodies-grapple-with-crypto-funded-terrorism">Regulatory bodies grapple with crypto-funded terrorism</h2> 
The recent surge in crypto funding comes amid an intensifying conflict scenario. The deadly attacks orchestrated by Hamas and PIJ over the weekend left a trail of destruction in Israel. 
Cryptocurrencies, with their decentralized blockchain technology, enable users to sidestep the traditional banking apparatus, facilitating instantaneous fund transfers to digital wallets. This feature, although groundbreaking, is now being exploited by militant outfits to evade financial scrutiny and sanctions, posing a formidable challenge to both the US and Israeli authorities striving to sever their foreign funding conduits. 
The US Treasury Department highlights the glaring gaps in financial crime controls on crypto exchanges, which have become a conduit for terrorist groups, including Hamas, Islamic State, and al Qaeda, to secure donations in digital currencies. Despite Israel’s endeavors to freeze Hamas crypto accounts, pinpointing the exact amount of crypto seized remains a tough nut to crack. 
Israeli Defense Minister Yoav Galant voiced the complexities surrounding banning these groups from crypto exchanges, marking it as no trivial pursuit. The quest to unveil and disrupt the financial infrastructures nestled within the cryptosphere continues as the global community grapples with the rising tide of crypto-funded militancy. 
The multifaceted nature of the crypto space, coupled with weak or nonexistent anti-money laundering and countering the financing of terrorism (AML/CFT) controls in certain jurisdictions, has further compounded the challenges.&nbsp;

Palestinian terrorists raised over $100 million in cryptocurrency donations since 2021: Report

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