The United States Department of Justice (DOJ) has seized more than $200,000 in cryptocurrency that was intended to support Hamas, a militant group. The DOJ announced this action on March 27, stating that these digital funds were part of a larger effort to track and prevent the use of cryptocurrencies in illegal activities.
Authorities found that these funds were linked to online fundraising campaigns that Hamas allegedly controlled. Since October 2024, more than $1.5 million in digital currency had moved through these accounts before the US government took action. The DOJ explained that these transactions were processed through different virtual currency exchanges and handled by financial agents to hide their true origins.
US officials said the confiscated funds were spread across at least 17 different cryptocurrency wallets. These wallets act like digital bank accounts but are often more difficult for law enforcement to track. The seizure is part of an ongoing effort to stop illegal financial activities linked to groups that the US considers threats to national security.
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Sanctions and Legal Action Against Crypto Use in Terrorism
Hamas has reportedly been using cryptocurrency to raise funds since at least 2019. The US government, along with its allies in the United Kingdom and Australia, has been trying to block such efforts. In January 2024, the US Treasury Department, along with financial agencies in those two countries, imposed sanctions on people and networks involved in helping Hamas move money through digital currencies.
These sanctions built on previous restrictions that the US Treasury put in place in October 2023. Such measures are meant to prevent individuals and companies from sending or receiving funds linked to sanctioned groups. The goal is to cut off financial support that could be used for attacks or other harmful activities.
In addition to government actions, some private citizens have also taken legal steps against cryptocurrency platforms. In early 2024, families of victims affected by Hamas attacks filed a lawsuit against Binance, one of the world’s largest cryptocurrency exchanges. The lawsuit claimed that Binance had allowed Hamas to use its platform to move funds, arguing that the company had provided assistance to the group. Binance, however, denied these claims, saying it had no connection to Hamas.
The US government has previously investigated Binance over concerns about how it handles transactions. In November 2023, Binance agreed to pay a $4.3 billion settlement to the DOJ after facing allegations that it had not followed strict anti-money laundering rules. The case highlighted growing concerns about how cryptocurrency platforms can be used for illegal activities.
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Growing Concerns Over Cryptocurrency and Terrorism
US officials have become increasingly worried about how terrorist organizations might use cryptocurrency. Unlike traditional bank accounts, cryptocurrency transactions can be more difficult to track, making them an attractive option for groups trying to move money in secret.
A December 2024 report by the Congressional Research Service stated that Hamas has been trying to collect donations through cryptocurrency for years. However, the report also noted that the full impact of these efforts remains unclear. While digital fundraising exists, it is not known how much of this money actually reaches the group or whether it significantly contributes to its operations.
Despite concerns, reports suggest that only a small fraction of cryptocurrency transactions are linked to terrorism financing. A study by the blockchain analysis firm Chainalysis in 2023 found that most terrorist organizations still rely on traditional cash-based methods rather than digital currencies. Still, the US government continues to monitor and take action against illegal crypto transactions to prevent any potential threats to security.
By seizing these funds and imposing sanctions, US officials aim to limit the ability of groups like Hamas to raise money through digital means. The recent cryptocurrency confiscation is part of broader efforts to ensure that financial networks—both traditional and digital—are not used to support harmful activities.
