Bitcoin’s Link in ‘Terrorist’ Activities: Real Concern or Can It Be Stopped?

Cryptocurrency Is Used For Many Terrorist Activities, But How Can It Be Stopped?

Most people are aware o the risks that they take on when they invest in cryptocurrency, since the industry still lacks the protection that many platforms need.

However, to help make this digital asset into something more mainstream, companies have been looking to show more use cases. Like any technology and innovation, it is possible for this cryptocurrency to get into the wrong hands, and the same is true with cryptocurrency and terrorist organizations.

A prime example is of a formerly active group on the Dark Net called al-Sadaqah, which is translated to “voluntary giving.” They were not even hiding in the shadows at all; they were easily found on both Facebook on Telegram when they were running a Bitcoin funding campaign. Within the month of raising funds at the time, there was an anonymous donation of BTC 0.075.

It was only worth $685 at the time, but the value rose to $803, and the group transferred funds to another address. Right now, this group can even still be found on Twitter, with the following description:

“An idependant organisation that is benifiting and providing the Islamic rebels in Syria with fininacal aid.”

It is obvious that cryptocurrency is a beneficial asset around the world, and the proper use can help to empower the financial industry and even reduce fraud in the industry. However, as said above, the risk that comes with these rewards is the way that criminals and terrorists can also apply them to further their cause.

There is no actual proof that that there is any digital currency adoption at an institutional level by terrorists, but there are times that terrorists have specifically shown use of digital currency. These situations show how risky that cryptocurrency could be without regulations and without understanding how the process works.

Why Is Crypto Appealing To Terrorist Organizations?

Every token and coin are created with a process called “mining,” which confirms every transaction that takes place. The information from the transaction is logged directly on the blockchain, though there is no connection with identifying information.

Basically, the currencies remain anonymous somewhat, which makes it harder for law enforcement officials to link up transactions to specific users, which basically makes terrorist donations private.

Another factor has to do with the trust of cryptocurrency and blockchain. Bitcoin has been involved in many investigations that are linked with exchanges between criminal transactions, amounting to over 40% involvement in illicit transactions in just the European Union alone. The fact that some terrorist organizations were involve with these investigations should come as no surprise, since there is a similar level of credibility to that of financial institutions still.

The biggest reason that cryptocurrency appears to be targeted is as a result of the security that it affords users, which comes primarily in the form of transparency. Blockchain ensures that funds cannot be retrieved from where they are sent, unless the recipient sends them back. This technique is crucial to the prevention of double spending on tokens, and the blockchain keeps it that way. When terrorists and other criminals decide to make purchase through the Dark Net, their funds are secured in a way that protects them from attack by other criminal organizations.

There have been a few reports of the use of these benefits over the years. Islamic State fighters were reportedly involved in purchases with Bitcoin in 2014. The Abu-Mustafa fundraiser in 2015 tried to justify the use of cryptocurrency, saying that the stricter regulations should be a good enough reason for the use of cryptocurrency on the Dark Net.

Other cases include using social media to request crypto support, using false credit cards to purchase cryptocurrency to support specific groups, and many other instances. Even though these actions seem small at first, they indicate that the currencies are being used for terrorist groups in some way.

How To Stop Crypto From Being Used In Terrorism

Based on the recommendations of Nikita Malik from Forbes, there are a few ways that these concerns can slowly be eliminated. Her first suggestion? “Tapping into criminal error.”

Even though Bitcoin is widely appreciated for its supposed anonymity, the blockchain can be publicly accessed, so the path of any transaction can be tracked. To cover up Bitcoin interactions on the Dark Net, criminals often use a software that is about to make their transactions anonymous, but that does not conceal the record.

One of her other suggestions is to regulate the industry better. The United States government was researching the connection between Bitcoin and terrorism with their Department of Homeland Security last year, urging them to strengthen regulations. Even the United Kingdom has Her Majesty’s Treasury working on their regulations,

With these two efforts, Malik says, “we can disrupt financial flows to criminal and terrorist groups online.”