Israel’s Cyber Division Takes Down Hamas-Linked Cryptocurrency Accounts
Israeli Operation Against Hamas-Linked Cryptocurrency Accounts
In response to the ongoing Israel-Gaza conflict, Israel’s cyber division, Lahav 433, has taken control of Hamas-linked cryptocurrency accounts. The execution of the plan was done in collaboration with the NBCTF (National Bureau for Counter Terror Financing), a subsidiary of the Ministry of Defense, Shin Bet, and other intelligence agencies.
Their goal was to prevent these terrorist organizations from raising funds using cryptocurrencies. Hamas recently launched a fundraising campaign on various social media platforms, urging the public to support them with cryptocurrency donations.
Once Lahav 433 and NBCTF got this information, they began to identify and freeze such crypto wallets with the assistance of Binance, a prominent cryptocurrency exchange platform. The Israeli cyber division said it would transfer the seized funds to the state treasury.
Hamas And Cryptocurrency Fundraising
Hamas’ utilization of cryptocurrencies for financial gains is not new. Data shows that Israeli authorities have seized 189 cryptocurrency accounts on Binance since 2021. However, such accounts have strong affiliations with Palestinian and Islamist extremist groups, including some proxy accounts associated with three Palestinian currency exchange firms.
Similarly, US authorities also took control of an extensive network connected to three of Hamas’s financial backups and six firms in the Middle East and North Africa. This network provided financial support for the terrorist group by managing an international investment portfolio.
Meanwhile, Chainalysis, a famous blockchain analytics company, noted that Hamas had accumulated tens of thousands of dollars through cryptocurrency over time. Recall that the military arm of Hamas, the Al-Qassam Brigades (AQB), stated in April 2023 that it would no longer receive crypto donations because the authorities were prosecuting its contributors.
Two months after the AQB’s announcement, the Israeli government disclosed that it had confiscated crypto assets worth $1.7 million from accounts associated with Hezbollah and the Iranian paramilitary Revolutionary Guard’s elite Quds Force. At the time, Israeli Defence Minister Yoav Gallant stated that these terrorist organizations received funds through digital currencies.
Binance Offers Assistance Amidst Its Legal Challenges
Meanwhile, Binance’s assistance in this operation is commendable, given that the crypto firm is facing legal challenges. In March, the US Commodity Futures Trading Commission (CFTC) filed a lawsuit against the platform, citing multiple violations, including potential involvement in criminal activities such as money laundering.
It is worth noting that Lahav 433 collaborated with British law enforcement to freeze an account at Barclays Bank, UK, which Hamas had publicly shared for receiving donations. This multi-pronged approach underscores Israel’s commitment to combat terrorism financing and seizing the strategic financial assets of terrorist organizations.
Israel-Gaza Conflict And The Crypto Market
Some analysts have raised concerns that the ongoing conflict between Israel and Hamas will cause a short-term decline in investments in high-risk crypto assets, particularly Bitcoin. Analysts have drawn parallels to historical instances where escalating geopolitical instability led to investors staying away from volatile assets.
This trend was notably observed during Russia’s invasion of Ukraine in 2022. At the time of writing, Bitcoin is down 1%, mirroring declines in equities.
This decline coincides with a rise in oil prices amid apprehensions that the unrest in the Middle East might extend and disrupt global trade. On-chain data also shows that over $100 million in crypto futures have been liquidated in the last 24 hours.
Meanwhile, some traders advocate for a close watch on energy markets, as they often offer insights into BTC’s price action. A surge in oil prices traditionally leads to expectations of a more stringent monetary policy, posing risks to the crypto market.
Nevertheless, this situation underscores the growing correlation between crypto and broader macroeconomic forces. Lahav 433’s successful seizure of Hamas-affiliated cryptocurrency accounts showcases the innovative ways law enforcement agencies utilize to combat terrorist financing in the digital age.
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