U.S. Justice Department says it has seized cryptocurrency used by Hamas to fund terrorism

The U.S. Department of Justice said in a statement that authorities have seized more than $200,000 worth of cryptocurrency from at least 17 wallets.

The U.S. Department of Justice (DOJ) said in a statement on March 27 that authorities have seized more than $200,000 worth of cryptocurrency that was intended to support the militant group Hamas.

The cryptocurrencies, valued at a total of $201,400, were traced to fundraising addresses allegedly controlled by Hamas, which have been used to launder more than $1.5 million in digital assets since October 2024.

The DOJ said the money laundering was done through a series of "virtual currency exchanges and transactions, using questionable funders and over-the-counter brokers." The funds are currently held in a combination of at least 17 wallets.

Court documents showing the seizure of Hamas-related cryptocurrency.

In January 2024, the U.S. Treasury Department's Office of Foreign Assets Control, along with its counterparts in the United Kingdom and Australia, announced sanctions against crypto trading networks and facilitators associated with Hamas. These sanctions build on the U.S. Treasury Department's sanctions in October 2023.

In January 2024, the families of three victims of Hamas attacks in Israel sued Binance and its former CEO Changpeng Zhao, alleging that the exchange provided "substantial assistance" to terrorists. During oral arguments, lawyers representing Binance claimed that the exchange had "no special relationship with Hamas [...]".

Binance has faced scrutiny from the U.S. government for alleged deficiencies in its anti-money laundering controls. The exchange reached a $4.3 billion settlement with the Department of Justice in November 2023.

Is more regulation needed?

According to a December 2024 Congressional Research Service report, Hamas has allegedly sought cryptocurrency donations since at least 2019, although the "scale and effectiveness" of these efforts is unclear.

The use of cryptocurrency by terrorist organizations to raise funds has become a growing concern in the United States, with some officials questioning whether the industry needs more oversight or regulation to prevent such activities.

According to a 2023 Chainalysis report, terrorist financing accounts for a very small proportion of cryptocurrency use, and illegal organizations still insist on using traditional, fiat-based methods to fund operations.