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<p class="is-style-lead">Terrorism financing is chiefly reliant on fiat currency, not cryptocurrencies, as revealed by the latest Chainalysis report.</p>
<p>On Oct. 18, Chainalysis, a blockchain analytics firm, published a <a href="https://www.chainalysis.com/blog/cryptocurrency-terrorism-financing-accuracy-check/" target="_blank" rel="noopener noreferrer nofollow">report </a>that sheds light on the cryptocurrency’s minimal role in funding terrorism.</p>
<p>The “Correcting the Record” report aims to rectify flawed methodologies that have previously exaggerated the extent of cryptocurrency’s involvement in terrorism financing.</p>
<h2 class="wp-block-heading" id="terror-groups-prefer-cash-over-crypto">Terror groups prefer cash over crypto</h2>
<p>While some organizations such as Hamas, Hezbollah, and Palestinian Islamic Jihad utilize cryptocurrency for financial activities, it remains a small part of their overall funding strategy, Chainalysis argued.</p>
<p>The firm further emphasized that terrorist organizations have historically used and will likely continue to use traditional, fiat-based methods. These include financial institutions, hawala, and shell companies as their primary financing vehicles.</p>
<p>Cryptocurrencies, due to their transparent nature, are less suitable for such illicit activities. This transparency allows for easier tracking by government agencies and blockchain analytics firms, making it more challenging for terrorist organizations to move funds undetected.</p>
<p>You might also like: <a href="https://crypto.news/binance-reportedly-blocked-over-100-hamas-related-accounts/" rel="noopener noreferrer nofollow"> Binance reportedly blocked over 100 Hamas-related accounts </a></p>
<p>Chainalysis also debunked the notion that a significant amount of cryptocurrency is being used for terrorism financing. While $82 million in cryptocurrency might appear to have been raised for such purposes, the firm estimates that only about $450,000 came from wallets affiliated with terrorist activities.</p>
<p>The rest of the funds processed through suspected service providers were unrelated to terrorism, according to the report.</p>
<h2 class="wp-block-heading" id="media-misinformation-on-crypto-s-role-in-terrorism">Media misinformation on crypto’s role in terrorism</h2>
<p>This news follows a recent <a href="https://home.treasury.gov/news/press-releases/jy1816" target="_blank" rel="noopener noreferrer nofollow">disclosure </a>by the US Treasury, indicating a Bitcoin transaction made to Hamas operatives. Notably, the sum involved was only $2,000, a trivial amount compared to the hundreds of millions of dollars that reportedly fund the group, as highlighted by the financial blog ZeroHedge.</p>
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   <p lang="en" dir="ltr">Behold the pure, unadulterated evil that is bitcoin: <br><br>Treasury Sanctions "Hamas Operatives and Financial Facilitators" and reveals the historic fund flow via bitcoin to the tune of- drumroll – $2,000<br><br>Just ignore the hundreds of millions in cold hard USD cash used to fund Hamas.… <a href="https://t.co/JABwKfsAUc" target="_blank" rel="noopener noreferrer nofollow">pic.twitter.com/JABwKfsAUc</a></p>— zerohedge (@zerohedge) <a href="https://twitter.com/zerohedge/status/1714627129583825122?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">October 18, 2023</a>
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<p>Mainstream media outlets, including industry antagonists like the Wall Street Journal, have often used the issue of terrorism financing to fuel their<a href="https://www.wsj.com/articles/cryptocurrency-feeds-hamass-terrorism-e0db54f5" target="_blank" rel="noopener noreferrer nofollow"> anti-crypto stance</a>. However, Chainalysis’s report makes it clear that when it comes to funding terrorism, cash remains the preferred method despite not making sensational headlines.</p>
<p>Read more: <a href="https://crypto.news/imf-economic-stability-risk-amid-israel-hamas-conflict/" rel="noopener noreferrer nofollow"> IMF: Global economic stability at risk amid Israel-Hamas conflict </a></p>

Chainalysis report debunks crypto’s role in terrorism financing

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