What is terrorist financing? Terrorist financing is a subject that is becoming more and more important in our world and, at the same time, more complex considering technological advancements. Being able to understand what terrorist financing is, is a value proposition in today’s environment.
What Is Terrorist Financing? Cryptocurrency And Terrorist Financing
Terrorists and terror organizations have long threatened our lives. If we think about it, we probably all have our own experience with this. Be it that we witnessed an act of terrorism ourselves or that we know someone that did. Terrorists and terror organizations threaten the security, infrastructure, citizens, and communities worldwide. It is estimated that terrorists kill an average of 21,000 people worldwide yearly. Terrorism tends to be very geographically focused: 95% of deaths in 2017 occurred in the Middle East, Africa, or South Asia.
There is a song called “Money makes the world go around,” which is true for terrorists and terror organizations. Money is the lifeblood of terrorism. Terrorist organizations require significant funding for the actual undertaking of terrorist acts and other issues. In particular, to maintain the organization’s functioning, provide for its basic technical necessities, and cover costs related to the spreading of their ideologies.
Forbes Magazine has compiled a list of the Richest Terror Organizations in the world. They estimate the total annual income of the ten most prominent terror organizations at almost 4 billion US Dollars. The Hizbollah organization is at the top of that list, with 6.2 billion US-Dollar alone.
How can it be that these terrorist organizations can receive so much money, especially in the light of the global fight against terrorism, global economic sanctions, and designated lists for terrorist organizations?
The answer is terrorist financing. Terrorist financing can be described simply as financing terrorist acts, terrorists, and terrorist organizations. But terrorist financing is more than just providing the money to them. Terrorist financing can also facilitate terrorist acts using other assets or stores of value such as oil and natural resources, property, legal documents, financial instruments, and others. But terrorist financing does not stop there.
Terrorists also make more and more use of modern technologies, including the blockchain and cryptocurrencies. They use cryptocurrency to help fund attacks more easily than they could ever do with fiat currencies. Having said this, although terrorists use the darknet markets for acquiring weapons, it is unlikely that cryptocurrency would be used to purchase equipment for an attack directly. Instead, attackers in Western countries are more likely to convert funds in cryptocurrency accounts into fiat currencies, which would be a convenient way for the terrorist organization to supply funding to the attacker.
Of course, many cryptocurrency exchanges are subject to banking regulations for suspicious activities, so it may still be difficult to withdraw large amounts of cash. Nonetheless, poorly regulated cryptocurrencies provide an attractive avenue for transactions of terrorist organizations, such as accepting donations or financing activities.
Terrorist financing is the economic foundation of terrorist activities as well as the lifeblood of terrorist organizations. Terrorist organizations have gradually come to use cryptocurrency to finance their activities based on traditional methods of raising funds in recent years. The anonymity of cryptocurrency is appealing to terrorist organizations, but its use is still limited.