Israel seizes millions of dollars in cryptocurrencies linked to Iran and Hezbollah

With the advent of cryptocurrencies have come new security challenges. Due to the anonymity offered by digital currencies such as Bitcoin, they have become a way to finance criminal or even terrorist acts. Governments have realised the dangers of this major challenge and have stepped up operations to dismantle networks that finance criminal or terrorist organisations.

In this regard, nations such as the United States and Israel have stepped up their efforts to curb the financing of terrorism in the Middle East. The Israeli authorities, in particular, have recently announced the seizure of millions of dollars in cryptocurrencies from a financing network linked to the Quds Force of the Islamic Revolutionary Guard of Iran (IRGC) and Hezbollah. The operation, the first of its kind against the IRGC and the Lebanese Shi'ite group, marks "a precedent by exposing the source of terrorist financing through digital currencies", as Israeli Defence Minister Yoav Gallant noted. "We have thwarted the transfer of millions of dollars to terrorists," he added. 

Gallant has defined this operation as "extensive", recalling that since the beginning of the year members of Hezbollah, the Quds Force and "site elements" have used cryptocurrencies to fund their terrorist activities, The Times of Israel reports. "The funding comes from a third party and is delivered to terrorist groups through money changers," he added. 

Israel's Defence Minister has underlined Iran's role in this regard. "Iran is the financier, trainer and propagator of terrorism against Israel and many countries in the world, both directly and through its proxies on the borders," Gallant said.

Tehran has been accused on several occasions, not only by Israel, of financing and arming Middle Eastern terrorist groups, thus contributing to the destabilisation of the region. The Islamic Republic has even allegedly taken advantage of humanitarian aid destined for Syria after the February earthquake to supply weapons to its militias in the country. 

Now, with Bitcoin and other digital currencies, Iran sees an opportunity to continue financing armed groups in the region since, due to the sanctions to which it is subject by the West, it is isolated from the world financial system, which prevents it from using international financial systems such as SWIFT, used for bank transfers.

This operation is a further blow to the financing of militias hostile to Israel. Previously, Israeli authorities confiscated cryptocurrencies from Hamas leaders in Gaza, which has led the Palestinian group to stop fundraising using Bitcoin due to increased "hostile" activity against donors, according to the Israeli media. Similarly, last May, Israel seized around 190 crypto accounts on Binance linked to Palestinian and Islamist terrorist groups since 2021.

Years ago, the US Department of Justice also announced the dismantling of three cyber-terrorist financing campaigns involving the al-Qassam Brigades, the military wing of Hamas, al-Qaeda and Daesh.