Bipartisan Legislators Urge Clarity on Cryptocurrency’s Connection with Financing Hamas Attacks on Israel

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A bipartisan group of lawmakers is demanding answers from the Biden administration regarding the financing of surprise attacks on Israel by the Palestinian militant group Hamas and the role cryptocurrency played in it.

More than 100 lawmakers, including Sens. Elizabeth Warren (D-Mass.) and Roger Marshall (R-Kan.), as well as Rep. Sean Casten (D-Ill.), have joined forces to request information from Treasury Department undersecretary Brian Nelson and White House national security advisor Jake Sullivan regarding the administration’s plans to tackle Hamas’s crypto financing capabilities.

The lawmakers’ demand for answers comes after a recent report by the Wall Street Journal revealed that Hamas received approximately $41 million in cryptocurrency over the past two years, while Palestinian Islamic Jihad, another militant group, received up to $93 million.

Both groups are recognized as foreign terrorist organizations by the U.S. and are subject to sanctions from the Treasury Department.

“Congress and this Administration must take strong action to thoroughly address the risks of illicit crypto financing before it can be used to fund another tragedy,” the lawmakers wrote in their letter, which was submitted on Tuesday.

“As Congress considers legislative proposals aimed at mitigating money laundering and illicit finance risks associated with cryptocurrency, we urge you to swiftly and firmly act to significantly reduce illicit crypto activities and safeguard our national security as well as that of our allies,” they added.

For the past year, Warren and Marshall have been working together to pass bipartisan legislation that cracks down on the potential illicit uses of cryptocurrency, such as money laundering, sanctions evasion, and drug trafficking.

However, the bill has encountered opposition from Senate Banking Committee Chairman Sherrod Brown (D-Ohio), who has raised doubts about the extent to which existing regulations already cover cryptocurrency. Notably, Brown has also signed the letter sent on Tuesday.

Furthermore, the Biden administration announced new sanctions targeting Hamas on Wednesday morning. The sanctions are directed at several members of the militant group, a top commander, a cryptocurrency exchange based in Gaza, and a Qatar-based financial facilitator.