What’s Going On?
Crypto is a poor form of money for terrorists, US Congress has heard.
Why Does It Matter?
“Cold, hard cash is still king,” Yaya Fanusie, Director of Analysis for the Foundation For Defense of Democracies Centre on Sanctions and Illicit Finance, told the US House Financial Services Committee in prepared testimony last week.
al-Qaeda, the Islamic State and other terrorists groups have tried multiple times to raise funds via cryptocurrency, without much luck, reported Forbes. A group called Mujahideen Shura Council (MSC) in Jerusalem attracted two contributions for a total of just over $500 in a 2016 online campaign.
So Terrorists Don’t Like Crypto?
According to the Centre for a New American Security (CNAS), the amount of crypto used for terrorist activities between 2015 to 2018 amounted to just eight bitcoins, reported Cryptocurrency365. The study also noted jihadists enjoyed mainstream financing which means that there is no reason to replace fiat with crypto.
Fanusie said managing large amounts of cryptocurrencies requires specific skills which terrorists may currently lack, reported Cointelegraph. Price volatility and vulnerability to hackers also help make the use of crypto a “fringe activity both among the general public and within the population of global jihadists”.
However, while organised terror groups haven’t found success with cryptocurrencies, several white supremacist groups around the world have reported a measure of success using them for fundraising and payments, said CCN.