US Lawmakers Seek to Halt Hamas Crypto Funding Amid Gaza Tensions

In a significant move, a bipartisan group of 105 lawmakers, led by Senators Elizabeth Warren, Roger Marshall, and Representative Sean Casten, has urged the Biden administration to take immediate action to combat the use of cryptocurrency by Hamas and the Palestinian Islamic Jihad. The lawmakers expressed deep concerns about these organizations using digital assets to fund their operations and evade U.S. sanctions.

Crypto Funding for Terrorism Raises Concerns

Recent reports have highlighted how Hamas and Palestinian Islamic Jihad have increasingly turned to cryptocurrency to support their activities. Israel’s seizure of crypto wallets belonging to Hamas, alongside the escalating use of digital assets by these groups, has raised alarm bells.

Meanwhile, earlier this week, Israeli law enforcement authorities have taken strong action against cryptocurrency accounts suspected of financing Hamas. Notably, their efforts to cut the ties between crypto markets and the militant organization have intensified in response to recent attacks.

In addition, Binance, the leading cryptocurrency exchange, has already closed over 100 accounts since the conflict began on October 7.

Meanwhile, Senator Elizabeth Warren, a prominent advocate for tighter anti-money laundering rules for cryptocurrency in the U.S., has been rallying bipartisan support for legislation aimed at countering the potential misuse of cryptocurrencies for funding terrorism. Notably, The risk of crypto-financed terrorism is now considered a real and urgent priority by a growing coalition of senators.

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What’s Next?

This bipartisan push for action comes at a time when President Biden was set to meet with Israeli Prime Minister Netanyahu in the wake of a recent attack in Gaza. It remains to be seen how the Biden administration will respond to these lawmakers’ call for action in addressing crypto illicit finance risks.

As per recent reports, the U.S. authorities have seized “tens of millions of dollars” in cryptocurrencies from Hamas-linked addresses. Meanwhile, the letter from lawmakers demands transparency regarding the extent of crypto’s involvement in funding these organizations and the actors facilitating these financial transactions.

Meanwhile, Joe Biden has expressed solidarity with Israel in its conflict against Hamas during his visit to the country on Wednesday. In addition, he also commented on the explosion at the Al-Ahli al-Arabi hospital in Gaza on Tuesday, which led to the cancellation of a planned summit with Arab leaders.

While Palestinian officials attributed the blast to an Israeli airstrike, Israel claimed it was the result of a failed rocket launch by the Palestinian Islamic Jihad militant group, which denied responsibility. Notably, Biden, after inspecting the situation, suggested that it appeared to have been caused by parties other than Israel. The incident disrupted his diplomatic mission to the Middle East.

However, given the increasing tensions, President Biden’s response to this bipartisan plea will play a crucial role in determining the government’s stance on the use of cryptocurrencies for illicit purposes.

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