Who finances Hamas? A global network of crypto, cash and charities

Who finances Hamas

The Palestinian militant group Hamas uses a global financing network to channel support from charities and friendly nations, passing cash through Gaza tunnels or using cryptocurrencies to circumvent international sanctions, according to experts and officials.

However, Hamas, which rules the Gaza Strip, will face greater obstacles in accessing funds following the massacre of hundreds of Israelis, mostly civilians, by the group’s gunmen. Israel has responded with the largest bombardment of Gaza in 75 years of conflict.

Earlier this week, Israeli police reported that they had frozen a Barclays bank account that authorities said was linked to Hamas fundraising and blocked cryptocurrency accounts used to raise donations, without specifying how many accounts or the asset value.

The move provided a glimpse into a complex financial network, partly legitimate and largely hidden, that sustains Hamas, or the Islamic Resistance Movement, and its government in the Gaza Strip, which it has led since 2007.

Matthew Levitt, a former US counterterrorism official, estimated that the majority of Hamas‘s budget, more than $300 million, came from corporate taxes, as well as from countries such as Iran and Qatar, or from charities.

Last February, the State Department claimed that Hamas raises funds in other Gulf countries and obtains donations from Palestinians, other expatriates and its own charities.

Reuters could not reach Hamas officials for comment for this article. In the past, Hamas has said that financial restrictions imposed on its donors were an attempt to neutralize legitimate resistance against Israel.

Hamas, sanctioned as a terrorist organization by the United States and countries such as Britain, has increasingly used cryptocurrencies, credit cards or artificial trade agreements to avoid growing international restrictions, Levitt said.

Hamas has been one of the most successful users of cryptocurrency for terrorist financing,” said Tom Robinson, co-founder of blockchain research firm Elliptic.

However, this year Hamas said it would move away from cryptocurrencies after a series of losses. The cryptocurrency accounting system allows these types of transactions to be tracked.

Blockchain researchers TRM Labs said this week in a research note that crypto fundraising has previously increased following rounds of violence involving HamasFollowing the May 2021 clashes, Hamas-controlled cryptocurrency addresses received more than $400,000, according to TRM Labs.

However, since last weekend’s violence, prominent Hamas-linked support groups had moved only a few thousand dollars through crypto, TRM noted.

A likely reason for the low volume of donations is that Israeli authorities are immediately targeting them,” TRM said, adding that Israel had seized cryptocurrency worth “tens of millions of dollars” from Hamas-linked addresses in recent years.

Between December 2021 and April this year, Israel seized nearly 190 cryptocurrency accounts that it said were linked to Hamas.

Also read: What is the origin of Hamas?: history of the group at war with Israel

Ships and shells

Whether through crypto or other means, Hamas allies have found ways to get money into Gaza. The US State Department has claimed that Iran provides up to $100 million annually in support to Palestinian groups, including Hamas, and has cited methods of moving the money through shell companies, maritime transactions and precious metals.

Iranian authorities did not immediately respond to a request for comment.

Last year, Hamas had established a secret network of companies that managed investments worth $500 million in companies from Turkey to Saudi Arabia, according to the US Treasury, which announced sanctions against these companies in May 2022.

Israel has long accused Iran’s clerical leaders of stoking violence by supplying weapons to HamasTehran, which does not recognize Israel, says it provides moral and financial support to the group.

Support for the Palestinian cause has been a pillar of the Islamic Republic since the 1979 revolution and a way for the country to establish itself as a leader in the Muslim world.

Gas-rich Qatar has also paid hundreds of millions of dollars to Gaza since 2014, at one point spending $30 million a month to help operate the enclave’s only power plant and to support needy families and residents. public officials of the Hamas-led government.

Qatari aid provides $100 to the poorest Palestinian families and extends the period of electricity for one day in Gaza,” a Qatari official said in response to a government request for comment, adding that it had helped “maintain stability.” and the quality of life of…Palestinian families.”

Iran's Foreign Minister Hossein Amir Abdollahian meets with the top leader of the Palestinian group Hamas, Ismail Haniyeh, in Doha, Qatar, on October 14, 2023 (Reuters)Iran’s Foreign Minister Hossein Amir Abdollahian meets with the top leader of the Palestinian group Hamas, Ismail Haniyeh, in Doha, Qatar, on October 14, 2023 (Reuters)

Qatar walks a tightrope in foreign policy, hosting the region’s largest US military base, the Taliban and other groups, often allowing it to mediate.

Money talks

Qatar’s funding to Gaza actually goes through Israel, according to a source familiar with the process.

Funds are transferred electronically from Qatar to IsraelIsraeli and UN officials bring the cash to Gaza across the border.

The money is distributed directly to needy families and public officials in Gaza, and each family or individual must sign next to their name that they have received the money. A copy of that sheet goes to Israel, another to the UN and another to Qatar.

Qatari aid to the Gaza Strip is fully coordinated with Israel, the UN and the United States,” the Qatari government official stated.

In recent years, Qatar purchased fuel from Israel for Gaza‘s only power plant. It also shipped Egyptian fuel that Hamas can resell, using the proceeds for salaries.

Stephen Reimer, of the Royal United Services Institute, predicted that further attempts to totally restrict the group’s access to formal financial channels would have limited success. “Their financing tactics have grown to elude them.”

(C) Reuters.-