Blockchain analytics firm Chainalysis dismissed reports and analyses circulating in the media that exaggerate the role of cryptocurrencies in terrorist financing. Chainalysis noted that terrorist financing accounts for only a small percentage of illicit cryptocurrency transactions. Terrorist organizations have historically used traditional legal-based methods such as financial institutions, hawalas and shell companies as their primary source of financing, and are likely to continue.
Chainalysis stressed that the transparency of blockchain transactions makes it less suitable for terrorists, which is the main reason Hamas stopped accepting $BITCOIN$ donations. This transparency enables law enforcement officers to track the origin and destination of every transaction on the blockchain, a feat that is nearly impossible to accomplish with cash transfers.
