New victory for cryptocurrencies! This October 18, the Wall Street Journal (WSJ) revealed that cryptocurrencies were used to finance Hamas’ recent terrorist attack against Israel. According to estimates, several $82 million worth of crypto had been used. Informed, several American legislators stepped up and demanded answers from Joe Biden’s administration. Offended by this new anti-cryptocurrency crusade, the company Chainalysis published, on the same day, a report which reveals the real sources of financing of terrorism.
More than a hundred American lawmakers on a crusade against cryptos
This Wednesday, Senator Elizabeth Warren, Senator Roger Marshall and more than a hundred American legislators launched what could have resulted in a real anti-crypto crusade. They wanted answers from the US administration on the involvement of cryptocurrencies in Hamas attacks against Israel.
Indeed, according to figures published by the WSJ, nearly $82 million in cryptocurrencies were collected to finance the Hamas terrorist attack. According to them, “terrorists, rogue nations, drug traffickers, and other criminals are using cryptocurrencies to endanger U.S. allies and national security.”
Chainalysis quickly looked into this accusation and published, the same day, a report which denounces the exaggeration and the analytical errors contained in the WSJ article. Called “Correcting the Record”, this report from Chainalysis fell like a comet and plunged the fiat currency.
Fiat is king of terror financing, not crypto, says Chainalysis
In its report, Chainalysis revealed serious errors in the estimation of the total amount of crypto transfers supposedly intended to finance Hamas. According to the document, the cited total of $82 million in transferred crypto includes funds that are not explicitly linked to terrorist financing.
Chainalysis reveals that of this total, only $450,000 of funds, including $2,000 of bitcoin, came from a terrorist-affiliated wallet. She also adds that terrorism is still financed with fiat and especially with cash and that cryptos play a negligible role.
Indeed, she explains, with the transparency of transactions carried out on the blockchain, it is easy for government agencies to identify and disrupt crypto flows linked to terrorism. Thus, fiat is more suitable for financing terrorist organizations because it is not as traceable as cryptos.
In a country with no regulatory framework on the status and place of cryptocurrencies in the economy, these revelations represent a major victory for cryptocurrencies.
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