In brief

  • Hamas has seen a recent uptick in Bitcoin donations during the latest conflict.
  • Bitcoin has often be used in circumstances where relevant parties are blocked from traditional finance rails.

According to a senior Hamas official quoted in the Wall Street Journal, the Palestinian militant group Hamas has witnessed a surge in Bitcoin donations since the outbreak of armed conflict with Israel last month

The cryptocurrency market has allowed Hamas—which rules the Gaza Strip and is considered a terrorist group by the U.S., UK, and others—to circumvent international sanctions. 

“There was definitely a spike [in Bitcoin donations],” the Hamas official said, adding, “Some of the money gets used for military purposes to defend the basic rights of the Palestinians.” 

Given that Hamas has been labeled a terrorist organization by many of the world’s powers, it has been locked out of the global financial system. As a result, it’s turned to more inventive funding sources like cryptocurrency donations. 

The Hamas official—who did not want to be named—did not declare exactly how much Bitcoin the group has received, but they did say its proportion of overall revenue for the group is growing. 

What’s more, this is not the first time Hamas has turned to Bitcoin for revenue. In 2019, the al-Qassam Brigades—Hamas’ military wing—launched an online call for Bitcoin donations. The group “boasted that Bitcoin donations were untraceable and would be used for violent causes,” the U.S. Department of Justice said last year. 

The cryptocurrency initiative came alongside similar campaigns from al-Qaeda and the Islamic State. 

In August 2020, the U.S. Department of Justice announced that it had dismantled all three terror financing campaigns, seizing “millions of dollars, over 300 cryptocurrency accounts, four websites, and four Facebook pages.” 

Behind the calls for Bitcoin donations

Groups that have been targeted by anti-terror measures have to go about their calls for Bitcoin donations carefully. 

In Hamas’ case, the group’s military wing has turned to Telegram, an encrypted messaging service. Per The Wall Street Journal, the al-Qassam channel has gained 261,000 followers, six times more than the official Hamas channel. 

Other groups, like Islamic State, once turned to a now-defunct anonymous messaging app called BCM, an acronym for “Beyond Communication Matters.” 

Telegram now requires a phone number before a user registers an account. Before BCM closed down, users were not required to provide any identifying information to use the service. 

Users were also able to create groups of up to 100,000 people. BCM previously did not comment on this issue. 

Bitcoin and the far-right

Other extremist groups have turned to cryptocurrency donations to finance their activities, too. 

Earlier this year, a French donor paid over $500,000 in Bitcoin to “far-right activists and internet personalities” that took part in the Capitol Hill riots on January 6. Per a Chainalysis report, 28.15 Bitcoin was sent on December 8 to 22 separate addresses, many of whom belonged to members of the far-right that took part in the riots. 

The source of funds was believed to have come from a now-deceased computer programmer in France. A suicide note dated December 9—a day after the Bitcoin was transferred—claimed that Western civilization was on the decline. 

“I care about what happens after my death. That’s why I decided to leave my modest wealth to certain causes and people,” the note read.