Palestinian militant group Hamas has seen a spike in crypto donations to fund its operations since its renewed armed conflict with Israel, report says | Currency News | Financial and Business News

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  • A Hamas official said the militant group has seen a spike in crypto donations, the WSJ reported.
  • "Some of the money gets used for military purposes to defend the basic rights of the Palestinians," they said.
  • It isn't clear when Hamas began receiving these donations.
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Hamas said it has seen a rise in cryptocurrency donations since violent clashes with Israel broke out in May, the Wall Street Journal reported on Wednesday, citing a senior official of the militant group.

The escalation in armed conflict began on May 7, when Israeli police stormed the Islamic holy site al-Aqsa Mosque during the period of Ramadan and injured over 200 people. Palestine's Islamist group retaliated by firing rockets into Israel from Gaza, after which Israel struck back with its own airstrikes at Gaza.

Both sides eventually agreed to a ceasefire on May 20, after 11 days of the bloodiest fighting seen in the region in seven years.

The conflict drew widespread international attention, not just to the chaos of the situation, but also to websites run by the group's armed wing, the Izz ad-Din al-Qassam Brigades, WSJ said. Heightened interest led to increased donations that are facilitating its operations.

"There was definitely a spike" in bitcoin donations, the Hamas official told the Journal. "Some of the money gets used for military purposes to defend the basic rights of the Palestinians."

Adel Hana/AP

It isn't clear when Hamas began receiving crypto donations. But its designation as a terrorist group by Israel, the United States, the European Union and Britain means that it had to turn away from the global financial system to rely on other complex networks for funding.

The group has especially benefited from the anonymity of crypto transactions, WSJ said. Last year, US federal authorities seized $1 million in cryptocurrencies tied to the group's armed wing. A previous investigation by the Journal found al-Qassam converted most of its bitcoin into cash, or gift cards, aided by two Turkish intermediaries.

The Hamas official didn't mention the amount of cryptocurrency it had received, but said overall revenue has been rising. It has also been collecting other forms of donations from supporters.

In one instance, a branch of the Iranian armed forces sent more than $200 million to the group between 2015 and 2019, the WSJ said, citing data from the US Treasury. Iran does not recognize the legitimacy of Israel as a state. Its supreme leader, Ali Khamenei, called the predominantly-Jewish state "not a country, but a terrorist base" last month.

For the Palestinian organization, cryptocurrencies offer an easier method of making sure transactions go undetected as they are untraceable.

"Our fundraising strategies keep on evolving as more restrictions are being placed on us," the Hamas representative said.

Read More: Financial researcher Nik Bhatia explains why asset managers with a growth focus could be violating their fiduciary duty if they don't consider bitcoin – and compares the crypto to Amazon's stock 20 years ago

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