Israel Seizes Millions in Cryptocurrency Belonging to Iran’s Islamic Guard, Hezbollah Terrorist Group
Israel’s Defense Minister Yoav Gallant: “This is the first incident of this magnitude. We have effectively cut off the flow of terror funds via this channel.”
Israeli authorities seized millions of dollars in cryptocurrency from accounts linked to Iran’s Islamic Guard (IRGC) terrorist group and Iran-sponsored Hezbollah terror militia, the Israeli media reported.
The latest bust is part of a campaign by Israel to expose Iran’s vast terrorism financing network. Israel’s Defense Minister Yoav Gallant launched an “unprecedented operation to find and seize terror funds laundered by terrorist organizations supported by Iran,” the Israeli broadcaster Arutz Sheva reported Tuesday.
With this latest move, Israel “effectively cut off the flow of terror funds” through the mean of cryptocurrency, Defense Minister Gallant declared.
The Associated Press reported:
The Israeli government said Tuesday that it seized millions of dollars in cryptocurrency from accounts that had sent or received funds in alleged financing schemes for a powerful arm of the Iranian military and the Iran-backed Hezbollah militant group in Lebanon.
Israeli Defense Minister Yoav Gallant said he issued an order to seize the cryptocurrency wallets and turn over the funds to the Israeli government.
He described the “extensive” operation as Israel’s first to target the Hezbollah militant group and the Iranian paramilitary Revolutionary Guard’s elite Quds Force — two organizations sworn to Israel’s destruction. Both have been designated by the United States and some other governments as terrorist organizations and locked out of the traditional global financial system.
It was a multi-agency effort, Gallant said, involving Israel’s Mossad spy agency, the Israeli military intelligence office, the Israeli police and others.
Israel has previously seized cryptocurrency belonging to the paramilitary arm of Gaza’s Hamas rulers as part of counterterrorism financing investigations.
“This is the first incident of this magnitude,” Gallant said, noting that the effort took place earlier this week. “We have effectively cut off the flow of terror funds via this channel.” (…)
Gallant alleged that Hezbollah and the Quds Force rely on virtual currency to finance their militant activities. Cryptocurrencies such as Bitcoin are favored for illicit transactions because they are perceived as hard to trace. Anyone in the world can create a Bitcoin account and begin receiving digital funds without providing a name or address.
The revelation comes nearly two months after Israel went after the Iran-funded terrorist Hamas’s cryptocurrency operations, forcing the jihadist group to suspend Bitcoin transactions.
“In April, Palestinian terrorist group Hamas announced it would stop receiving fundraising via the bitcoin cryptocurrency, citing “hostile” activity against donors, following Jerusalem’s seizure months earlier of numerous digital wallets linked to terrorism funding,” the newspaper Israel Hayom reported Wednesday.
The anonymity provided by cryptocurrencies allows rogue regimes like Iran to transfer assets to terrorist groups across international borders. Iran spends nearly a billion dollars annually to finance terrorist groups such as Hezbollah, Hamas, Islamic Jihad (PIJ), and Yemen’s Houthi militia. Hezbollah alone receives around $700 million a year, the Israeli defense ministry revealed in March.
In October 2020, President Donald Trump imposed crushing banking sanctions on Iran, further isolating the world’s biggest state sponsor of terrorism from the international financial system.
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If they seized the funds- that means they either the crypto currencies aren’t secure- or they managed to get their hands on all the passwords, PINs, etc being used on the accounts.
Either way- doesn’t seem like a good sign for the future of crypto currencies. The whole point of them is to keep such things from happening.
My first thought. The whole idea behind crypto, as I understand it (and I admit to knowing very little about it), is that it was beyond the control of governments.
Harder to trace, and interdict.
Govts have the same advantages vs. “crypto” as other things: near infinite resources, use of force, and they make the other rules. Consider running an old-school bookmaking operation, using encrypted betting slips. The G can still get at that without breaking the encryption.
The crypto hype is tuilp-bubble type BS, see the FTX kerfuffle. Crypto tech has both more, and less magic manna than fits the buzz.
Seems to be relatively common for cryptocurrency exchanges to be hacked by various groups and/or people and millions siphoned off into untraceable accounts.
•• World’s largest crypto exchange hacked with possible losses of $500m:
https://www.theguardian.com/technology/2022/oct/07/binance-crypto-hack-suspended-operations•• FTX: Collapsed crypto exchange says $415m was hacked:
https://www.bbc.com/news/business-64313624•• Wormhole cryptocurrency platform hacked for $325 million after error on GitHub
https://www.theverge.com/2022/2/3/22916111/wormhole-hack-github-error-325-million-theft-ethereum-solana•• More than $90 million in cryptocurrency stolen after a top Japanese exchange is hacked
https://www.cnbc.com/2021/08/19/liquid-cryptocurrency-exchange-hack.htmlBizzarrely, or maybe not, many crypto exchange stacks are pretty sloppily built, not using the techniques, components, or math of the currencies they manipulate. They’re ledgers, n transaction clearing, on multiple platforms, hosted on Teh Interwebz for maximum instability, and hacking exposure.
“Exchanges” are best understood as attempts to grab some turf and cash in on the bubble, more like Amazon trying to “get big fast” grabbing territory to be “the everything store”, than highly-disciplined tech development.
When you hear “crypto exchange” picture that grifter-toad who crashed his non-bank exchange, after a pile of celebration and praise nearly as large as the Theranos Steve Jobs impersonator got before her fall.
Same here.
If governments can ‘seize’ crypto then the whole concept crumbles.
The only rational explanation I can think of is that they stored the funds in an exchange, instead of an actual private wallet. If that’s the case then they are pretty stupid.
Yeah, exactly so.
Like most things, “crypto” may work if you use it right; if you don’t certainly won’t.
Must have gained access to the private keys. Either the Iranians kept them in a hot wallet, exchange, or if in a cold wallet they were able to obtain access through a planted spy. No other methods would work, and they could just be lying and or exagerating the seizures. Always remember if its not your leys its not your crypto.
I have never trusted crypto, I am glad that Iran did. How about redistributing fentanyl is a to Iran, N Korea, and China?
Likewise. To me, crypto seems to be nothing but hype walking on air, supported only by the gullibility of the people who “buy” it.
Kind of like a chain letter.
You pay the fee to the person who sent it to you, and then you send it to 5 people and hope they pay you the fee.
Its not just risky, its stupid.
That is NOT how cryptocurrencies work.
Not even close.
A lot of “crypto” interest is just fad-driven speculation flying around some new, synthetic commodities. It’s remarkably similar to “the internet.”
For the substance, which there is some despite the BS, you need the second word to tease out which aspect of “crypto” is going on.
— “Crypto Exhanges” grab chunks of activity in the new territory of people wrangling “crypto” things.. They make some of their money on activity, like transaction fees. They make other money speculating with your deposits, as with FTX. So, they’re shady banks, except they aren’t banks, so shame on you if you don’t assume they might be shady.
— “Crypto Currency” uses cryptography tech to make a declared currency. Currencies are just tokens that represent money — chips on the roulette table, but the thing is the quatloos the chips represent.
— “Crypto, Blockchain” is a ledger that’s public, distributed, accessible by anyone on demand, and hard to fake or forge. So you can get a confirmable record that you own that piece of land, not dependent on the pleasure of the county clerk, and hard to forge. Tokens in this kind of ledger make an interesing currency.
— “Crypto, Encryption” stands for particular implementations of some special math and techniques that together do some crazy, interesting things to hide, verify, and recover information, that makes the more abstract stuff possible.
There’s more, but that’s a handle on the tech. What people are doing with it is pretty much what people do.
Iran doesn’t trust it anymore.
Well, the game isn’t “trust.” The game is who do you distrust least, or differently.
Adulterated coinage history goes back to Rome, and before. These days you just move a decimal point on a federal ledger and voila, devalued currency. Technology has made that part easier.
You’d like a currency-the-tokens to be identifiable, self-verifying, anonymouse, durable, portable, perhaps infinitely divisable. You’d like “money” to be all those things, plus of stable value, and fungible. It’s bills, vs “dollars”: bills you carry around as tokens for dollars that that represent fungible, stable value. (Ledgers just count these up.
— When the people running the money system treat ledgers as primary, you have a problem.)
— Any currency or “money” is vulnerable, for example to theft. The difference is how you steal it.
Apparently Iran hadn’t figured out how cryptocurrency works. You’d think that at least their hackers would know.
I bet the Hezbos are almost as apoplectic as the Democrats today..
And here I thought cryptocurrency was supposed to be able to prevent that.
Thanks for the heads up, Vijeta. I guess I’ll continue to avoid crypto currencies.
What does that say about the potential U.S.A. central bank digital currency (CBDC)???
With a government controlled central bank digital currency there is a greater risk that an Executive Order or other mandate can be used to deny you access to some or all of your funds if you don’t do what the government says (as compared to a distributed independent “cash” based banking system).
Look how workers in companies with federal contracts were forced to choose between their job and a vaccine. That one example should be enough to show that the government has no problem denying people their livelihood. “Ira, we see in your electronic medical records that your _____ numbers are off. You either need to lower them within the next 30 days or we will put a limit on your monthly withdrawals and levy a penalty. If this continues to be a problem your case will be sent before the Review Board. …”
A CBDC is the ultimate power an authoritarian government can have over its citizens. Denying us the ability to pay for food, shelter, security and mobility (they’re already scrambling to get the latter in place as quickly as possible).
Whether or not you share my concerns regarding a potentially authoritarian government, the risks from outside – whether governments or criminal enterprises – would be great as well. No matter how you slice it, digital currency is only as good as the paper it’s printed on, IMO.
Could Israel please connect the dots for money being laundered back to the Xidens? Asking for a friend. FJB
My tinfoil hat says they know.
Why do you think this administration hasn’t gone further against Israel?
Push it too far, and it becomes worthwhile to the Isrealis to spend the leverage, and exponsing what you can do.
Change my mind.
The israelis are sending clear signals to Teheran that it will deal with a terror supporting and nuclear approaching Iran by whatever means necessary and however and whenever Israel deems it appropriate