A cryptocurrency fundraising operation used by Palestinian militant group Hamas has been shut down by the Coinbase cryptocurrency exchange following a tip by an Israeli civil rights organization.
“It has recently come to our attention that the notorious Palestinian terrorist group Hamas currently maintains an account with Coinbase, Inc. (‘Coinbase’), through which it is accepting donations,” the Shurat Hadin-Israel Law Center, a nongovernmental organization, wrote on Tuesday to the US-based Coinbase, one of the largest cryptocurrency brokerages, the Jerusalem Post reported.
“Therefore [we are] writing to notify Coinbase that knowingly providing material support or resources to Hamas is a violation of US federal criminal law, and to demand that Coinbase immediately terminate any and all accounts and services provided to Hamas.”
In the US, financial transactions with terrorist organizations, as the US government has designated Hamas to be, were banned under the 1995 Counter-Terrorism Act.
Hamas, an acronym for Islamic Resistance Movement, is a Palestinian militant group that formed in 1987 as a offshoot of the Egyptian Muslim Brotherhood. Responsible for attacks, including suicide bombings, in Israel during the First Intifada and after, the group won elections in Gaza in 2007 and has dominated its government ever since. At that time, Israel instituted a blockade of the territory and has waged numerous short wars against Hamas there since.
CoinDesk noted last week that Whitestream, an Israeli blockchain analytics firm, had recently discovered several instances in Hamas digital media channels in which public requests for donations pointed to bitcoin wallet addresses.
“Based on shared inputs, we can tell that Hamas blockchain transactions were signed by addresses that are operating on Coinbase company wallets,” Itsik Levy, the firm’s founder and CEO, told CoinDesk.
The fundraiser didn’t accumulate very much: the three addresses together only collected less than $4,000 worth of bitcoin, according to Coinbase.
However, Whitestream also reportedly provided proof of the accounts in question potentially sending bitcoin to accounts on Binance, the world’s largest cryptocurrency exchange, and CoinPayments, a cryptocurrency payment platform, meaning they also participated in what the US would consider to be financing a terrorist organization.
Levy noted that “only 2 percent” of all bitcoin transactions are connected to any kind of criminal activity.