A recent report that a Palestinian militant group has received funding in bitcoins brings to fore the debate on the regulation of cryptocurrencies and their possible uses in terror financing and other criminal activities.
The Israeli International Institute for Counter-Terrorism (ICT) reported that Al Nasser Brigade which is classified a terror group has received funding from individuals overseas through BTC.
The group which as affiliated to Popular Resistance Committee (PRC) that operates on the Gaza strip owns the Bitcoin address “1LaNXgq2ctDEa4fTha6PTo8sucqzieQctq,” which has been monitored and found to have received thousands of bitcoins in the past several years.
The preference for Bitcoin is to avoid detection by taking advantage of the limited anonymity that the cryptocurrency offers its users. This is the stance of Jerusalem Post which reported the news on Monday. The media also pointed out that the group is not just the military arm of PRC but also has strong links to Hamas. The report shows that 3,370 bitcoins have been received by the group. This is equivalent to nearly $30 million in illicit transaction cloaked to avoid sanctions.
Al-Naser Brigades has been designated a terrorist organization by the Unites States since 2000 and is known to have links with Hezbollah as well as Hamas. The group is one of many others associated with the objective of reclaiming territories seized by Israel.
Iran has traditionally been a backer of militant groups in the area but relationship soured when some of the groups backed ISIS against the Iran-backed Syrian government. The report also said that Hamas has been a beneficiary of $23 million monthly funding from the country. It is not clear though where the BTC funds came from as this was not highlighted in the report.