Author: Jinshi Data
The U.S. Treasury Department stated in a report to Congress that it is investigating $165 million worth of cryptocurrency-related transactions. It may have provided financial support to Hamas before its attack on Israel on October 7 last year.
U.S. Treasury officials said Hamas’ increasing use of digital currencies to obtain funds underscores the need for Congress to approve new powers to oversee cryptocurrencies, while Hamas Maas’ traditional funding channels have been attacked by the West.
But efforts to expand regulation have been met with resistance. Cryptocurrency advocates and lawmakers who support the industry seek to minimize the role of digital currencies in illegal activities.
On Tuesday, the U.S. Treasury Department submitted a report to Congress on Hamas’s use of digital currencies, which included estimates of Hamas’ involvement in cryptocurrency-related transactions. The first official evaluation of a cryptocurrency.
U.S. Treasury Undersecretary Wally Adeyemo said in a letter to lawmakers: "We continue to estimate that Hamas and other terrorists prefer traditional financial products and services,but I remain concerned , as we cut off their traditional financial channels, these organizations will increasingly turn to virtual assets.”
The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN), which authored the report, said , nearly 20 financial institutions reported approximately $165 million in transactions related to Hamas and digital assets in the past three years. The exact amount used by the group remains unclear, the report said.
FinCEN says Hamas’s use of cryptocurrencies may be exaggerated. Out of an abundance of caution, these financial institutions may attribute the entire value of customer transactions, including traditional currencies and digital assets, to Hamas.
Wally Adeyemo told lawmakers: "There is still a lot we don't know about this activity."
According to Western officials, Hamas launches annual It received approximately $100 million in funding from Iran and generated revenue through its $500 million global investment portfolio. Since October, Israeli military operations have disrupted the roughly $600 million in taxes Hamas collects annually in Gaza, the group's largest source of funding, the officials said. But they added that Hamas has been diversifying its funding sources and methods of moving money.
In recent months, the U.S. Treasury Department has sanctioned several Hamas financiers it identified, including a money changer in Gaza The exchanger is considered the architect of Hamas’s digital currency financing.
Cryptocurrency supporters, including former top U.S. intelligence and counterterrorism finance officials, say a public ledger for cryptocurrencies could help increase market transparency and deter the misuse of cryptocurrencies by terrorists and others who threaten national security. In recent years, they say, federal law enforcement agencies have disrupted billions of dollars' worth of illegal activity, including international child porn rings and ransomware hacker networks, as a result of this transparency.
The new regulatory powers the Treasury Department is seeking include requiring foreign exchanges to use U.S. financial trademarks and abide by the same disclosure standards as domestic companies.
Adeyemo said: "These proposals are intended to modernize the Treasury's tools and powers to address current and future challenges in the virtual asset ecosystem." p>
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