The latest round of fighting between Israel and Hamas may have dealt a military blow to the terrorist organization in Gaza, but it led to what one activist described as a “spike” in donations to the military wing of the Gaza Strip. group, the Wall Street Journal reported on Sunday.
Hamas has seen an increase in digital donations in the form of cryptocurrencies, according to the report, citing official and online data from Hamas. Using digital coins like bitcoin to receive funds from abroad allows the blacklisted group to bypass sanctions.
“There has definitely been a spike” in cryptocurrency donations, said a Hamas official who spoke to the Wall Street Journal on condition of anonymity. “Some of the money is used for military purposes to defend the fundamental rights of Palestinians,” they added.
According to the report, two websites linked to Hamas’s military wing, the Ezz-Al Din Al-Qassam Brigades, saw their traffic from the Arab world increase during the 10 days of fighting last month. Saraya.ps and the website and Telegram channel linked to alqassam.ps have carried out what can be called a sort of donation campaign.
“In the Arabic, English and Hebrew editions, alqassam.ps… features an animated video soliciting bitcoin donations that gives potential donors tips on how to conduct the transaction anonymously while avoiding regulators. The al-Qassam Brigades video tutorial advises potential donors to use public computers and software to hide their location and cryptocurrency platforms based in the British Virgin Islands and Seychelles.
Hamas is designated a terrorist organization by the United States and the European Union. Others, including Britain, have only outlawed al-Qassam brigades. Such a designation means that in the United States, for example, it is illegal to provide money or training, with financial companies controlling the linked funds being required to report them to authorities.
The Hamas official who spoke to the Wall Street Journal declined to say how much money the group raised in digital currency, but said cryptocurrencies were a growing part of their overall income. . The report notes that approximately $ 1 million in digital currencies linked to Hamas was seized last year by US authorities.
The increase in donations shows how Hamas has turned to cryptocurrencies to circumvent sanctions. “Our fundraising strategies continue to evolve as more and more restrictions are placed on us,” the Hamas official told the Financial Daily.
Reuters reported in 2019 how Hamas was adopting increasingly complex mechanisms to be able to receive digital coins despite legal restrictions placed on them. While their first digital donation campaign saw the cryptocurrency deposited into a single digital wallet, by the end of 2019 Hamas had created a new system that generated a new wallet for each donation.
This makes it harder for companies around the world to keep tabs on the group’s cryptocurrency funding, said researchers who worked with Reuters. Only one digital wallet can be flagged to cryptocurrency exchanges, which in theory allows them to block funds from passing through their systems to that destination.
At the time, a similar two-minute video on the al-Qassam Brigades website featured step-by-step instructions in Arabic on how supporters can bypass the traditional financial system and donate cryptocurrency. “How to support the Palestinian resistance via Bitcoin? he asks.
With neat graphics and English subtitles, it explains how to send bitcoin directly, through a bureau de change, or through a cryptocurrency exchange. “Use a public device so that the wallet is not tied to your IP address,” he says.
Regulators and law enforcement have long been concerned about the potential of digital currency – relatively anonymous and readily available online – to finance terrorism. Cryptocurrency regulations vary from country to country.
In the United States, federal investigators recently said that a proposal to register Bitcoin accounts would be particularly useful in identifying drug dealers, human traffickers and terrorists. Last month, the US Department of Justice created a government group to fight ransomware attacks by breaking the anonymity of cryptocurrency transactions, used by hackers and criminals.
However, many exchanges, which perform the critical operation of transforming cryptocurrency into dollars or other widely accepted currencies, are in countries beyond the reach of US regulators.
Reuters contributed to this report