Terrorists are turning away from cryptocurrency after failed attempts to fund it

Terrorists are turning away from cryptocurrency after failed attempts to fund it

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Answer Terrorists are turning away from cryptocurrency after failed attempts to fund it

Foreign terrorist groups such as ISIS and al-Qaeda have failed in repeated attempts to raise funds to fund their criminal operations using cryptocurrencies, according to testimony released today at the House Financial Services Committee hearing.

“Cryptocurrency is a problem for terrorists”

Speaking before Congress today at a House Financial Services Committee hearing, Yaya Fanousi, director of analysis at the Foundation for Defense of Democracies Center on Sanctions and Illicit Financing, explained that terrorist organizations have failed after repeatedly trying to fund their criminals and perpetrators with cryptocurrencies such as Bitcoin. and Ethereum.

The expert on illicit financial transactions cited an example of a failed online campaign in 2016 that saw only two total contributions to the Mujahideen Shura Council (MSC) in Iraq with transactions amounting to only two and amounting to nearly $500.

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Fanousi further elaborated, saying that “cold cash is still the property” of terrorists, due to the ease of concealment and keeping the funding anonymous. Money laundering is a major concern about cryptocurrencies and especially private currencies that can keep the identity of senders and recipients completely anonymous. However, terrorists also need to spend the collected money on various goods and supplies, and often conduct transactions in abandoned sites with “unreliable infrastructure and technology,” according to Fanousi. In such cases, cryptocurrencies based on high technology and high energy requirements become an obstacle to terrorists.

Why is cryptocurrency a revolutionary step forward?

Congress has been warned by Fanossi that crypto-based fundraising could eventually become a successful way to fund their operations, suggesting that all US government agencies focused on terrorist financing investigations must better understand digital financial transactions to analyze. more and more precisely.

“By preparing now for the growing pursuit of crypto-currency by terrorists, the United States can limit the ability to turn cryptocurrency markets into a safe haven for illicit financing,” Fanousi told Congress.

Yaya Fanoussi also warned Congress of the potential money laundering risks with privacy coins, such as Monero, Zcash, or Dash, which allow both dealing parties to remain anonymous. He explained that although US exchanges such as Coinbase or Gemini have strict anti-money laundering policies, other exchanges are more lax and may pose a significant risk.

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Terrorists prefer fiat currencies to cryptocurrencies, while the countries that embrace them are trying to do the opposite.

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While terrorist organizations struggle to raise funds via cryptocurrency, rogue states that often harbor and invest in such organizations are embracing the new technology.

Iran, among the countries described by former US President “George Bush” as the “axis of evil”, was considering launching its own national digital currency backed by fiat currency, in order to circumvent US-led sanctions and reviews against the country. Another “axis of evil” country, North Korea, was also said to have earned an estimated $15 to $200 million through mining and selling cryptocurrencies such as Bitcoin and Monero, according to Priscilla Maurichi, a former cybersecurity official at the agency. National Security.

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