In a speech delivered on Friday, U.S. Deputy Treasury Secretary Wally Adeyemo challenged recent claims that cryptocurrency is primarily responsible for terrorist financing. Contrary to assertions made by some members of Congress, who estimated over $130 million in Hamas terrorist funding through crypto, Adeyemo stated that cryptocurrency plays a relevant but relatively minor role in global terrorist financing operations, media reports said.
During his remarks on terrorist groups, sanctions, and illicit finance, Adeyemo emphasized that crypto is “not the vast majority of the ways that these groups are funded.” He acknowledged that terrorist organizations exploit new technologies, including cryptocurrencies, for moving money illicitly, but stressed the need to prevent crypto from becoming their predominant funding source in the future.
Adeyemo’s stance aligns with previous Treasury Department reports from last year, acknowledging that crypto’s use for money laundering remains significantly lower than that of fiat currency and more traditional methods. However, he acknowledged the unique attributes of cryptocurrencies, such as peer-to-peer transfers and irreversible transactions, which could make them useful to criminals under certain circumstances.
Referring to cryptocurrencies as an “evolution” in terrorist money laundering efforts, Adeyemo noted the shift away from traditional finance since 2001. While many crypto firms strive to comply with the law, he highlighted that some industry companies prioritize innovation without considering the consequences.
Adeyemo affirmed the Treasury’s commitment to using every available tool to target individuals or platforms facilitating the movement of resources for terrorists. Earlier this month, the Treasury announced sanctions against a Gaza-based crypto exchange, Buy Cash, for its connections to terror groups like Hamas and ISIS.
Despite over 100 members of Congress urging the White House to take more action against crypto terror financing, Adeyemo’s statements are supported by blockchain surveillance firm Elliptic, which published a blog post asserting that there is “no evidence to support the assertion that Hamas has received significant volumes of crypto donations.” The $130 million figure cited by policymakers was derived from a Wall Street Journal article based on Elliptic data.
