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Bitcoin The Almighty Buck Technology

Terrorists Turn To Bitcoin For Funding, and They're Learning Fast (nytimes.com) 62

Posted by BeauHD from the digital-currency dept.
An anonymous reader quotes a report from The New York Times: Hamas, the militant Palestinian group, has been designated a terrorist organization by Western governments and some others and has been locked out of the traditional financial system. But this year its military wing has developed an increasingly sophisticated campaign to raise money using Bitcoin. In the latest version of the website set up by the wing, known as the Qassam Brigades, every visitor is given a unique Bitcoin address where he or she can send the digital currency, a method that makes the donations nearly impossible for law enforcement to track. The site, which is available in seven languages and features the brigades' logo, with a green flag and a machine gun, contains a well-produced video that explains how to acquire and send Bitcoin without tipping off the authorities. Terrorists have been slow to join other criminal elements that have been drawn to Bitcoin and have used it for everything from drug purchases to money laundering.

But in recent months, government authorities and organizations that track terrorist financing have begun to raise alarms about an uptick in the number of Islamist terrorist organizations experimenting with Bitcoin and other digital coins. The yields from individual campaigns appear to be modest -- in the tens of thousands of dollars. But the authorities note that terrorist attacks often require little funding. And the groups' use of cryptocurrencies appears to be getting more sophisticated. The Middle East Media Research Institute, a nonprofit that tracks and translates communication from terrorist groups, is about to publish a 253-page report about the increased signs of cryptocurrency use by terrorist organizations. According to the NYT, the report will focus on groups in Syria that are on the run as Islamic militants have lost almost all the territory they used to hold.
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Terrorists Turn To Bitcoin For Funding, and They're Learning Fast More

Terrorists Turn To Bitcoin For Funding, and They're Learning Fast

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  • I tought there were "freedom figthers".

    • Ilhan Omar? Is that you?

      • Just "some people" doing "some things".

    • Re: (Score:2)

      by Nidi62 ( 1525137 )

      I tought there were "freedom figthers".

      There are both (and some groups are considered both by different states). You had the umbrella group FSA fighting against al-Assad-the FSA had religious groups, secular groups, groups backed by the US, groups backed by Turkey, groups backed by other Middle Eastern or European states, etc. There's the al-Nusra Front that is aligned with al-Qaeda (and so could be considered a terrorist group) also fighting against al-Assad. There are Kurdish groups as well, but their main concern at the moment is the increa

  • Couldn't this just be a good thing? (Score:3)

    by craighansen ( 744648 ) on Monday August 19, 2019 @08:13PM (#59104096) Journal

    Doesn't giving each terrorist an unique identifier help track them down? Plus, Bitcoin's ledger publicly discloses all the transactions.

    • Re: (Score:2)

      by ace123 ( 758107 )

      Bitcoin addresses only exist once money is sent to them, so it's free to generate infinite addresses and you can't even know they were generated until money was sent.

      Also, if money is never sent out of them, you wouldn't know the difference between a terrorist receiving it and a grandma being sent Bitcoins to hold onto.

      So the terrorists can just kind of hold onto the money, and if they are clever they can wait a long time transact by sharing the private keys themselves instead of doing transactions with mon

      • Re: (Score:1)

        by Z00L00K ( 682162 )

        If the conversion to cash from bitcoin is blocked then the usefulness of bitcoins is restricted.

        And if the bitcoin servers are taken out then all bitcoins are rendered useless. You only need to take over some servers and flag the bitcoin transactions as invalid.

        • That's not possible. Bitcoin was designed so that there is no single point of failure like that.

          • Re: (Score:2)

            by Z00L00K ( 682162 )

            However multi-point attacks by three letter agencies is still a possibility.

            • If they could take it down they would have already. Bitcoin had many predecessors that were centralized and shutdown and wasn't the first attempt at a sovereign currency. The game theory and incentives of Bitcoin are such that even 51% attacks are extremely costly to pull off, and would immediately be detected and stopped .

        • And if the bitcoin servers are taken out then all bitcoins are rendered useless.

          It's a peer-to-peer network. There are no "bitcoin servers". You might as well try to stop file sharing by taking out all the "bittorrent servers"; no one has managed to come anywhere close so far, and not for lack of trying.

    • Re:Couldn't this just be a good thing? (Score:4, Informative)

      by sexconker ( 1179573 ) on Monday August 19, 2019 @08:34PM (#59104140)

      Exactly. You can trace every Bitcoin transaction fully. The thing you want to figure out is when it's turned into fiat currency at an exchange. There aren't many exchanges around the world, and the ones that do exist are entirely comp'd. You're a goddamned moron if you're using BTC or any other cryptocurrency to engage in funding crime. If they care enough to try and find you you're making it trivial for them.

      • Well don't tell the morons that... we want them caught don't we?

        • I think the point is that BTC is sold as offering a safe and private transaction, but as the terrorist activity shows, it really doesn't unless you spend them directly - which makes you wonder why BTC in the first place

      • What about arms dealers accepting BTC? Once you create a sufficiently diverse BTC economy then the cash portion is much less critical. Do it through a sufficiently diverse, small value, reasonably low volume set of wallets that don’t intersect and tracking things becomes quite difficult. Easier than using cocaine as a currency. Getting cash out might be a bottleneck, and you need to remain invested in the volatility, but if you can get food, shelter, clothing, and ammo... you are set!

      • Interestingly, getting cash into the system can also be quite difficult. If you already have it in the system that's not a problem, but if you have 5000 in bills that's going to be noticed.
        • 5k is chump change. The OTC markets trade many millions of dollars alone in BTC daily alone. How do you think miners in china sell their BTC despite the banking bans? Many Bitcoin ATMs will allow you to even buy and sell those amounts without ID.
          • Cash. It's not bit coin. I made the distinction in my post, but I think you missed it.
            • Perhaps I missed what you are trying to suggest. In some aspects cash is more anonymous than Bitcoin as tons of it is laundered by banks and states and why terrorists prefer fiat over Bitcoin because Bitcoin lacks liquidity. It is still fairly easy to privately convert 10-50k usd in cash into Bitcoin though even without an OTC market .
              • Any bit coin transaction is traceable. My point was that if you try to convert cash to an electronic form, it is usually traceable too.
                • Not only can you buy BTC on OTC markets in a private manner you can buy thousands of dollars of BTC in person and atms without ID. There is a long list of services and ways to buy BTC without any ID for cash or by other means. This BTC will not be associated with your identity at all and why almost all of the drugs on DNM are purchased with BTC and over 99% of the items come delivered safely.

      • Where I live you can buy and i presume sell bitcoins pretty anonymously via atm-like machines or at small stores which likely overwrite surveillance data frequently. You could get caught by the security cameras or an employee might remember you but you have a pretty good shot at an anonymous exchange even if the law is chasing you. As long as you can keep your true identity distinct from your wallet you should be ok. I guess you would want to fund the wallet long before you do anything illegal and wait to c

      • If that's the case then why hasn't any encryption blackmailers been caught? You know the ones who encrypt files then blackmail people to pay with bitcoins.

      • Bitcoin is very fungible these days with wallets like wasabi and samourai with built in coinjoin. There is no way to trace these transactions in a practical matter and coinanalytics employees admit this. Additionally, someone can load up a lightning channel and send their BTC in an extremely private manner where its multihop and tor onion routed by default. Good luck tracking this.

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      They aren't interested in the secrecy/anonymity aspect, they are just trying to get around being kicked off mainstream payment platforms like Patreon and PayPal.

      When you look at their histories, these terrorists are hiding in plain sight. Sometimes just part of the crowd, sometimes with a veneer of respectability. They get booted from Patreon and Twitter and set up a Bitcoin account to maintain funding.

  • Funding terrorists since 2009...

    • Its actually a very recent phenomenon as fiat currencies are preferred to by terrorists studies show-

      https://www.europol.europa.eu/sites/default/files/publications/changes_in_modus_operandi_of_is_in_terrorist_attacks.pdf

      The reality is arms trade, terrorist financing, and even the cartel will mostly be using fiat for the foreseable future simply due to the lack of liquidity in Bitcoin and the previous arrangements they have with existing banks and states to launder the money.

  • They will use dollar bills - Not Bitcoin.
    • Paper currency is trackable via serial numbers but Beanie Babies are not.

      Think about that.

      • Re: (Score:2)

        by Z00L00K ( 682162 )

        And paper money can move around quite a bit before the numbers are checked - and competent forgers are also around so you can never be sure if the paper money is real or fake these days.

      • Paper money can only be traced easily when deposited into atms or banks with their OCR scanners. Terrorists and cartels also have existing partnerships with states and banks to help them easily launder the money. Terrorists prefer fiat primarily studies show and for multiple good reasons. https://www.europol.europa.eu/... [europa.eu]

  • Here comes the NYT with another Islamophobic hit piece!

    If this were an actual article about Bitcoin and terrorists trying to hide from authorities, it would be 3 sentences:

    The entry/exit point where traditional currency can be traded for a cryptocurrency like Bitcoin, or vice versa, is called an "exchange". Because Bitcoin and other cryptocurrencies rely on a distributed, public leger, it is trivial to trace every single transaction backward and forward to its source and destination exchanges. Western gov

  • The tighter you squeeze... (Score:5, Insightful)

    by blindseer ( 891256 ) <blindseer.earthlink@net> on Monday August 19, 2019 @09:03PM (#59104194)

    The tighter you squeeze your grip the more slips between your fingers.

    Requiring some kind of identity check on cryptocurrency won't do anything to stop this. It will only make legitimate trade more difficult.

    There's a law that making banking transaction over $10,000 requires filing some kind of paperwork to show that there was not any illegal behavior involved. When people first heard of this then they'd just keep everything under that threshold. The government didn't like this and so came up with a new crime of "structuring", that of making all transactions intentionally smaller than this threshold to avoid having to make these disclosures. This only caught up small businesses that made no intention to evade the law but only had routine business that triggered this "structuring". They government cannot define what structuring means exactly because if they do then people will simply structure their payments to not fit this new definition, whether they are doing legitimate business or not.

    Then we have the idea that selling drugs are bad. Let's say I'm fine with that, now can anyone define what it takes to be considered a drug dealer? The government simply defined possession of an illegal drug to be evidence of trying to sell drugs. That's not good, because now the victims of the drug dealers are now the victims of government enforcement. Let's assume that this is still acceptable, because someone abusing drugs is somehow a threat to themselves and others. I don't see how giving people a felony record for a mental illness is "helpful" in any way but whatever, let's roll with it. Now, since drugs are bad then the syringes, pipes, and so on that people use to take the drugs are bad. Now people need a prescription to buy sterile needles. Now we have people with mental illness being caught up in addiction and not able to buy clean syringes. This lead to the spread of AIDS and other diseases. This has gone beyond just syringes. Selling pipes or papers that are perfectly legitimate for smoking perfectly legal tobacco can get someone in trouble. This is so far removed from the actual act of someone taking advantage of another person's mental illness through dealing addictive substances that it has reached absurdity.

    Now we get to cryptocurrency. Drugs are bad. Terrorism is bad. Therefore funding either is bad. What is their solution to this? We will try to enforce a law, rule, or policy that to trade in cryptocurrency that everyone must have their identity known. First, this is doomed to fail because cryptocurrency is not an item of trade, it is a concept base on mathematics. If there is any kind of success in tracing a cryptocurrency then another will just pop up somewhere else. Second, even if they were to somehow get a handle on anonymous trade of cryptocurrency then there is the potential to shift to another means of trade.

    I remember reading about how people were using laundry detergent as a means to, and I don't mean this as a pun, launder money. Paying drug dealers with food stamps got to be more difficult with the new electronic payments. So they would buy laundry detergent to pay for their drugs. The drug dealers could then turn that laundry detergent into cash by selling it, or they'd trade it for some other item they found valuable.

    Here's an idea. How about instead of trying to solve societies problems with more government control we try to solve them with more personal freedom? It's getting to where there is so much government control that we've forgotten the original problem, and the government "solution" is far worse than that problem.

    • So they would buy laundry detergent to pay for their drugs. The drug dealers could then turn that laundry detergent into cash by selling it, or they'd trade it for some other item they found valuable.

      Since when can you buy detergent with SNAP benefits? That is for FOOD ONLY. You can't buy anything else with it.

      This from USDA's website:

      Any food for the household, such as:

      Fruits and vegetables;
      Meat, poultry, and fish;
      Dairy products;
      Breads and cereals;
      Other foods such as snack foods and non-alcoholic beverages; and
      Seeds and plants, which produce food for the household to eat.

      And the items that you can't buy with SNAP:

      Households CANNOT use SNAP benefits to buy:

      Beer, wine, liquor, cigarettes, or tobacco
      Vitamins, medicines, and supplements. If an item has a Supplement Facts label, it is considered a supplement and is not eligible for SNAP purchase.
      Live animals (except shellfish, fish removed from water, and animals slaughtered prior to pick-up from the store).
      Prepared Foods fit for immediate consumption
      Hot foods
      Any nonfood items such as:
      Pet foods
      Cleaning supplies, paper products, and other household supplies.
      Hygiene items, cosmetics

      Emphasis mine.

      Afraid I have to consider your entire post to be BS at this point, since you're not using your noggin. OP needs some massive downvoting. He's full of it.

    • Here's an idea. How about instead of trying to solve societies problems with more government control we try to solve them with more personal freedom?

      No. Just no. More personal freedom is exactly what we don't need. We have way too much already. The levels of personal freedom you're advocating for result in things like Jim Jones, and that entire Waco Texas fiasco. Need a more recent example? Jeffrey Epstein. See what he did with nearly limitless personal freedom?

      You're advocating for anarchy. If human beings could be trusted with unbridled level of personal freedom, we wouldn't need laws, police, militaries and.. oh here it comes: GOVERNANCE.

      Grow

      • Need a more recent example? Jeffrey Epstein

        The state could not even keep him alive for further questioning and you are asking us to trust them more?

        And Bitcoin is no exception. Personal freedom gone off the rails...And no. We won't accept that.

        If they could shut it down they would have already as they did to every sovereign currency that proceeded Bitcoin. Now companies like Fidelity, NYSE, and TDAmeritrade are heavily involved in bitcoin and they want their hunk of flesh so there is no turning back this direction.

  • The NSA has always been tracking all of this movement of cyber money.
  • These stories are part of the ongoing media propaganda that shows up in the media as a way to slander some person or denigrate a product or invention. Being that the United States does not really recognize Bitcoin as a valid currency (they see it more of a threat) and the US is the primier state-sponsor of terrorism in the world, how could this be true? ISIS's weapons were paid for and the terrorist who used them paid with US dollars. NED showers dissidents in countries whose government sill not kowtow to A

  • Terrorists have been slow to join other criminal elements that have been drawn to Bitcoin and have used it for everything from drug purchases to money laundering.

    The currency of criminals, terrorists and other undesirables. Please, just ban this goofy bs, already.

    It has absolutely no redeeming features. Everything it does for society is bad. Make it go away already.

    Crypto currency has always been kind of a joke. It's migrating from amusingly stupid, to not-so-amusingly dangerous.

    • Should I be able to make a donation to wikileaks or transact with other legal companies or should we just continue to allow operation chokepoint to continue to unethically target LEGAL companies? Should people in countries suffering from hyperinflation like Argentina and Venezuela be able to use Bitcoin for capital flight? Are you trying to make running certain forms of open source code illegal and how does that reflect for your respect of the first amendment?

  • As many have pointed out already - Bitcoin transactions are public and transparent, hence unsuitable for doing bad things.

    I suspect an intelligence agency set up this scheme as a honeypot to lure and identify terrorists. If true, then bringing this bitcoin-hate piece is working against the interests of global law enforcement.

    • Re: (Score:1)

      by ebvwfbw ( 864834 )

      Yes. However it's good to keep the stupid people (criminals) in the dark.
      Just like the Antifa people think nobody can figure out who they are.

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