Israel seizes cryptocurrency destined for Hamas terrorism funding

The Al'matchadun currency exchange company was accused of assisting Hamas with the transfer of tens of millions of dollars per year by the Defense Ministry.

 A coin representing the bitcoin cryptocurrency is seen on computer circuit boards in this illustrative picture (photo credit: REUTERS)
A coin representing the bitcoin cryptocurrency is seen on computer circuit boards in this illustrative picture
(photo credit: REUTERS)

A seizure order for Hamas-destined cryptocurrency worth tens of thousands of shekels was signed by Defense Minister Benny Gantz on Monday morning

This marks the third time within a year that Israel has seized cryptocurrency accounts funding terrorism.

The 12 digital accounts and 30 digital wallets belonged to businesses associated with the Al'matchadun currency exchange company, the Defense Ministry said.

The company, owned by the Shamlach family, is alleged to be affiliated with terrorism networks.

The Shamlach family has been accused by the Defense Ministry of assisting Hamas with the transfer of tens of millions of dollars per year.

Some of the cryptocurrencies announced today as confiscated by the ministry were owned by the Shamlach family. 

  A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken October 19, 2021.  (credit: EDGAR SU/ REUTERS)
A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken October 19, 2021. (credit: EDGAR SU/ REUTERS)

"We are taking all the possible measures to cut off the economic ‘oxygen supply’ to terror organizations," said Gantz.

"We continue to expand the tools to cope with terror and the companies that support it. I commend the organizations involved for their intelligence, operational, and legal cooperation. We will continue to take all the measures necessary to fight terror."

The operation was jointly conducted by the National Bureau for Counter Terror Financing in Israel (NBCTF), the national cyber unit of Lahav 433, and the IDF’s Intelligence Division. 

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In July 2021, the NBCTF said that it had seized Tether, Ether, XRP and other digital currencies meant for the Izzadin al-Qassam Brigades, Hamas's military wing. It was reportedly the first time such a wide variety of cryptocurrencies was seized.

In November 2021, The Authority for Combating Terror Financing and Money Laundering announced new regulations on cryptocurrency that required more transparent transaction reports.

Reuters reported in 2019 that researchers warned that Hamas was increasingly using bitcoin for funding its operations.