The US Justice Department has seized $201,400 in cryptocurrency funds allegedly destined for Hamas, according to a statement released on March 27. The seized digital assets were traced to fundraising addresses reportedly controlled by the militant group and represented part of a broader money laundering operation.

Federal authorities report that these cryptocurrency addresses were used to launder more than $1.5 million in digital assets since October 2024. The DOJ explained that the laundering operation utilized “virtual currency exchanges and transactions by leveraging suspected financiers and over-the-counter brokers.” Currently, the seized funds are held across at least 17 different cryptocurrency wallets.

This seizure builds upon coordinated international efforts to disrupt terrorist financing through cryptocurrency channels. In January 2024, the US Treasury’s Office of Foreign Assets Control collaborated with authorities in the United Kingdom and Australia to impose sanctions on networks facilitating crypto transactions linked to Hamas. These actions expanded upon earlier US Treasury sanctions established in October 2023.

The same month as these expanded sanctions, three families of victims from the Hamas attack against Israel filed a lawsuit against Binance and its former CEO Changpeng Zhao. The lawsuit alleged that the exchange had provided “substantial assistance” to terrorists. During oral arguments in the case, Binance’s legal representation countered by claiming the exchange had “no special relationship [with] Hamas.”

Binance has faced significant scrutiny from US authorities regarding its anti-money laundering controls. In November 2023, the exchange reached a $4.3 billion settlement with the Department of Justice.

According to a December 2024 report by the Congressional Research Service, Hamas has reportedly sought cryptocurrency donations since at least 2019, though the effectiveness of these fundraising efforts remains unclear. The growing use of cryptocurrencies by terrorist organizations has drawn increased attention from US officials, with some questioning whether additional industry regulation is necessary.

Despite concerns, a 2023 report by blockchain analytics firm Chainalysis indicated that terrorism financing represents only a minute fraction of cryptocurrency usage. The report suggested that illegal groups predominantly rely on traditional fiat-based methods to fund their operations rather than digital assets.

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