The Islamic terrorist organization Hamas turned to digital currencies last year to obtain tens of millions of dollars in financing from the Islamic Republic of Iran in preparation for its Oct. 7 attack against Israel, according to new reports.
In 2019, a Hamas commander known for engaging in the Hawala network, which funneled tens of millions of dollars in financing from Tehran to Hamas’s military wing, was neutralized by Israeli military forces.
According to reports, the commander ran a black-market system where trusted agents transferred physical cash and goods across borders to settle customers’ balances.
The replacement for the commander was a Palestinian terrorist businessman named Zuhair Shamlakh, who turned to digital currencies to evade Israelis.
The money exchanges transferred digital tokens to operators abroad to settle the Hawala balance.
Cryptocurrency was sent to the digital wallets controlled by the Hamas-affiliated money exchanges, where they swapped for cash at their offices in the Gaza Strip.
Such actions helped Hamas and Palestinian Islamic Jihad to receive large sums from Iran during the two years before the attack against Israel.
The efforts were new attempts to use financial technology to decrease the risks of moving physical money and goods.
In 2020, the cryptocurrency became a system used for large-scale financial transfers between Tehran and the organization within the Hawala networks.
In 2021, Israel’s National Bureau for Counter-Terror Financing issued seven orders to seize crypto funds held by three Gazan exchanges.
NBCTF officials said a significant sum of the funds received by the Gazan exchanges were for Hamas.
Several of the exchanges discovered by Israel look like typical storefront operations that offer international money transfers.
According to the Israeli Defense Ministry, Shamlakh, owner of the Al Mutahadun exchange, which was cited in five of the seizure orders, was Hamas‘a “main money changer” in charge of arranging the transfer of funds from the Islamic Republic of Iran.
According to the Israeli Defense Ministry, military intelligence officers have traced millions of dollars in payments from Iran’s Islamic Revolutionary Guard Corps (IRGC) to Al Mutahadun and other exchanges owned by Shamlakh for the Hamas’s Al-Qassam Brigades to buy arms and pay fighters.
Tehran has long supported Hamas, supplying the terrorist group with training and financial support.
Since the Oct. 7th surprise attack, Iranian Supreme Leader Ayatollah Ali Khamenei has voiced support for the terrorist organization, calling on all Muslim nations to condemn Israel and support Hamas against the Jewish state.
In Lebanon, the Iranian-backed terrorist group Hezbollah has joined the fight against Israel, engaging in border attacks against northern Israel.
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