Tether, a cryptocurrency issuer, announced on Monday that it has blocked 32 cryptocurrency wallet addresses holding a total of $873,118 that it claimed was connected to “terrorism and warfare” in Israel and Ukraine.
Last week, Israeli authorities claimed to have banned cryptocurrency accounts used to raise money for Hamas via social media. In an attack on Israel on October 7, Hamas murdered 1,300 people.
Tether did not specify when the addresses were frozen. Tether was a “currency of choice” for terrorist funding, according to TRM Labs, a significant U.S. blockchain analysis business that collaborates with law enforcement organizations.
Tether declared its dedication to “working closely” with law enforcement organizations worldwide “to combat cryptocurrency-funded terrorism and warfare.”
Since cryptocurrency largely works outside the established financial system and wallet addresses are anonymous, it is challenging to identify the parties responsible for transactions.
The third-largest cryptocurrency by circulation, Tether’s stablecoin, stated it collaborated with Israel’s National Bureau for Tackle Terror Financing (NBCTF) “to counter cryptocurrency-funded terrorism and warfare,” without providing any other information.
A stablecoin is a cryptocurrency often with value supported by assets like dollars.
Tether omitted information on the wallet addresses’ owners and the nature of their activities. It did not include a breakdown of the proportion of addresses associated with Israel and Ukraine.
Reuters asked the business specific questions about its response, but it did not respond.
A request for comment was not answered by the NBCTF, which has previously confiscated cryptocurrency accounts it said were connected to violent organizations like Hamas.
Since Russia invaded Ukraine last year, cryptocurrency has been extensively used, and after making a contribution plea, Kyiv raised more than $100 million in cryptocurrency. According to blockchain researcher Chainalysis, pro-Russian organizations in eastern Ukraine have utilized cryptocurrency for fundraising.
TRM said in February that the terrorist-financing organizations it monitors used Tether more frequently last year, with some utilizing the stablecoin entirely. For comparison, the biggest crypto token in the world, bitcoin, grew approximately 80%.
Companies like TRM use strategies like open-source investigations and cooperation with law enforcement to learn more about the owners of crypto wallets.
According to TRM, Tether’s success was a result of both its cheaper transaction costs and the volatility of bitcoin. When contacted for comment on the TRM blog, Tether did not reply.
