The dark side of blockchain: ISIS uses crypto extensively

The financial system today is under strict supervision worldwide. This makes it less easy for criminals to do their thing, but it also forces them to come up with creative solutions for their illegal practices. This includes the terrorist organization ISIS, which, like many other shady organizations, uses crypto.

ISIL holds crypto fundraiser

TRM Labs writes that in a research report. The blockchain analytics firm has evidence that ISIS members in Tajikistan, Indonesia, Pakistan and Afghanistan have funded their operations with cryptocurrencies. Almost all of the rogue transactions that TRM has observed have taken place with Tether’s stablecoin USDT on the Tron (TRX) blockchain. Moreover, this is increasingly the case, the company reports.

The money mainly comes from fundraising. Sometimes it concerns projects that seek money directly for ISIS, where even local crypto exchanges are used as a donation point. But sometimes the money is raised with a scam, where a charity serves as a cover. For example, the violent earthquakes in Turkey and Syria in early 2023 were used as a reason to raise capital from unsuspecting donors.

They also often send the money in installments, each often worth about $10,000. For example, they are less likely to be noticed by law enforcement and research agencies such as TRM Labs. The collected coins are mainly used to recruit soldiers.

ISIS is not the only malicious crypto user

The organisation uses such crypto fundraisers as it is subject to virtually global sanctions. It can therefore not open a regulated bank account anywhere, forcing it to look for alternatives.

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ISIS may sound like an exceptional case, but it is not. For example, it was announced at the beginning of this month that military personnel in Russia are also receiving financial support with such campaigns. Not only Ukraine is supported by people outside governments, the side of Russia also has its supporters.

In addition, there will still be hacking in crypto land in 2023. 2022 was a record for hackers. The first quarter of this year was quieter, but hackers have become a lot more active in the second quarter.

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