Israel has seized as many as 40 cryptocurrency wallets linked to Islamic Revolutionary Guard Corps’ (IRGC) Quds Force and the terrorist organization Hezbollah, The Times of Israel reported Tuesday.

This marks “the first incident of this magnitude” carried out by Israel, according to Defense Minister Yoav Gallant.

“A few days ago, an extensive and precedent-setting operation—to expose a route for financing terror with digital currencies—was wrapped up,” Gallant said at a conference hosted by the ministry’s National Bureau for Counter Terror Financing (NBCTF).

All of the funds seized by NBCTF in this action are in the USDT stablecoin issued on the Tron network, according to blockchain forensics firm Chainalysis.


Hezbollah is a Lebanese political and military organization founded in the early 1980s. A significant player in Lebanese politics, operating as both a political party and a paramilitary organization, it gained popularity for its resistance against Israeli forces. The Quds Force is the branch of the IRGC responsible for external operations.

The Minister added that since the beginning of the year, members of Hezbollah, the Quds Force, and certain “Syrian elements” have been relying on cryptocurrency as a means to finance their daily operations. The funds, originating from a third party, were transferred to the terrorist groups through money exchangers, per Gallant.

Israel turns to blockchain analytic tools

During Tuesday’s conference Gallant also revealed that the operation was carried out thanks to new tools the NBCTF had developed in collaboration with the Mossad spy agency, the IDF’s Military Intelligence Directorate, the Israel Police, and other bodies. Chainalysis confirmed its analytic tools “played a role in this landmark national security achievement.”


As pointed out by Chainalysis, since its inception, Hezbollah has been receiving the bulk of its funding from Iran—often via Syrian intermediaries, however, some of that activity has recently shifted to cryptocurrencies.

One of the most observed patterns includes the initial movement of funds from financial facilitators to hawala services and OTC brokers, after which they are transferred to Hezbollah-controlled addresses at mainstream exchanges.

“This NBCTF seizure is important for several reasons, beyond just the fact that it’s the first time any agency has seized cryptocurrency from Hezbollah and Quds Force,” Chainalysis said in a blog post. “The activity we analyze above is one of the first publicly available examples of terrorism financing via cryptocurrency that goes beyond simple, social media-based donation campaigns — in this case, sophisticated state actors were using crypto to funnel money across borders to a dangerous terrorist organization.”

The company added that this development underscores the fact that the battle against terrorism financing through cryptocurrencies is far from over, even in light of recent successes such as the Palestinian militant group Hamas, which is considered a terrorist group by the U.S., UK, and others, discontinuing its crypto donations program in response to law enforcement pressure.

Hamas’ military wing Al-Qassam Brigades (AQB), which is largely cut off from the global financial system, have until recently relied on cryptocurrency donations as one of the tools to circumvent international sanctions, but moved to shut down the program in April this year.

On several occasions prior to that, the Israeli Defense Ministry announced the seizure of cryptocurrency wallets linked to Hamas.

In February 2022, the Israeli authorities confiscated “dozens of thousands of Shekels” worth of cryptocurrencies allegedly intended to fund the group, with another $7.7 million in USDT, Bitcoin, and Dogecoin seized in July 2021.

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