Hamas Attacks: Elliptic Refutes Claims of Cryptocurrency Funding

The present article presents a detailed analysis carried out by Elliptic, a blockchain analytics firm, to disprove the assertion that Hamas financed its attacks on Israel using cryptocurrency. Furthermore, it explores the methodologies employed by law enforcement and researchers to track and immobilize cryptocurrencies. In addition to this, the article also sheds light on the prospective humanitarian uses of cryptocurrencies within the region.

Elliptic, according to Blockworks, has responded to a Wall Street Journal article from earlier this month that claimed Hamas funded its attacks on Israel with cryptocurrencies. When Democratic legislators inquired about the use of cryptocurrencies by terrorist organisations, they cited the report. According to prior reports by Blockworks, expert interviews suggested that the utilisation of cryptocurrencies as funding instruments was improbable owing to the characteristics of public blockchains. In a prior report, Elliptic asserted that law enforcement has the capability to “effectively halt the usage of cryptocurrencies by terrorist organisations.” Elliptic stated that there is no evidence to support the Journal's claim that Hamas raised “millions” in cryptocurrency and that data provided by Elliptic and others has been misconstrued.

Elliptic conducted further analysis on the funds and observed that, since October 7, a mere $21,000 in cryptocurrency has been donated, and most of this amount has been frozen by crypto businesses and researchers. As a result, Gaza Now has been unable to utilize these funds. In response to Senator Warren's letter, co-authored by numerous Democrats, Chainalysis advocated for a more thorough investigation into the potential misuse of cryptocurrency by terrorist organizations. According to Chainalysis, it is highly likely that only a small fraction of the $82 million in cryptocurrency was earmarked for terrorist activities, while the majority of funds processed by the alleged service provider were unrelated to such purposes.

Humanitarian causes have utilised cryptocurrencies to raise funds, as evidenced by the United Nations Relief and Works Agency for Palestine Refugees (UNRWA) enabling crypto donations a few years ago and Crypto Aid Israel garnering over $185,000 in cryptocurrencies.