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Read the Original Article <a href="https://www.coinlive.com/news-detail/182257" rel="noopener noreferrer nofollow">here</a>.In the aftermath of the recent <a href="https://www.nytimes.com/article/israel-gaza-hamas-what-we-know.html" rel="noopener noreferrer nofollow">Hamas attack in Israel</a>, the role of cryptocurrency in funding terrorist activities has come under scrutiny.Crypto analytics firm Chainalysis has noted that some reports may be exaggerating the extent to which terrorist organizations use digital currencies and have raised concerns about the methodologies used in these reports.<h2 id="header-0">Do Terrorists Really Prefer Cryptocurrencies?</h2>In a <a href="https://www.chainalysis.com/blog/cryptocurrency-terrorism-financing-accuracy-check/" rel="noopener noreferrer nofollow">blog post</a>, Chainalysis acknowledged that while terrorism financing constitutes only a tiny portion of the relatively small volume of illicit cryptocurrency transactions, certain terrorist groups do utilise cryptocurrencies for raising, storing, and transferring funds.It is important to note, however, that terrorist organisations predominantly rely on traditional fiat-based methods, such as financial institutions, hawalas, and shell companies, for their primary financing needs.<h2 id="header-1">The Investigation</h2>The recent Hamas attack in Israel prompted various media outlets to investigate the potential inflow of illicit crypto funds into the offensive.Senator Elizabeth Warren, along with over a hundred other lawmakers, cited a Wall Street Journal report that discussed the supposed use of cryptocurrency by Hamas.This led to a call for answers from President Joe Biden&#39;s administration regarding the matter.<h2 id="header-2">Not All Funds Are Related To Terrorism</h2>Chainalysis highlights that there are two key aspects to consider when analysing the flow of terrorism-related funds: quantifying the funds directly in the hands of a terrorist organisation and identifying the service providers that enable the movement of funds associated with terror financing.The firm pointed out that some recent estimates related to the attacks on Israel seemed to include all flows to certain service providers that received funds associated with terrorism financing.In other words, these estimates encompassed funds that were not explicitly linked to terrorism financing.For instance, it may appear that $82 million worth of cryptocurrency was raised for terror financing, but Chainalysis believes that a substantial portion of these funds were unrelated to terrorist activities.Chainalysis, in its analysis, identified approximately £450,000 worth of funds that were transferred from a wallet affiliated with terrorism out of the £82 million mentioned earlier. The firm emphasises that it would be inaccurate to assume that all transaction activity linked to this provider is related to terrorism.<img src="https://academy-public.coinmarketcap.com/optimized-uploads/a121ad57004c4717ab2575320626a260.x-www-form-urlencoded" />Source: <a href="https://www.chainalysis.com/blog/cryptocurrency-terrorism-financing-accuracy-check/" rel="noopener noreferrer nofollow">https://www.chainalysis.com/blog/cryptocurrency-terrorism-financing-accuracy-check/</a><blockquote>Given the activity of this address, the person or group of people controlling it is likely not the same person that controls the terror-affiliated wallet, but is rather a service provider that knowingly or unknowingly facilitated the terror financing activity.</blockquote><h2 id="header-3">Addressing The Core Issue</h2>Despite its scepticism about some media estimates, Chainalysis underscores the importance of considering the role of service providers in the context of terrorism financing.These service providers act as facilitators, and disrupting terrorist finance may involve imposing sanctions or undertaking other measures to cut off terrorists&#39; access to these services.

Chainalysis Latest Blog Post Questions Reports on Crypto's Role in Terrorism Financing

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