Here’s a story I’m covering just for the “What the hell?” factor.
The Tron blockchain has overtaken Bitcoin as the cryptocurrency network most favored by groups such as Hamas and Hezbollah, which are designated as terror organizations by the U.S., U.K. and other jurisdictions, Reuters reported on Monday.
There has been a sharp rise in cryptocurrency seizures from Tron wallets since 2021 and a decline in those from Bitcoin wallets, Reuters’ analysis found.
Israel has made 87 such seizures from Tron wallets this year, two-thirds of the total number going back to July 2021. These include 39 from wallets the country said in June were owned by Lebanon-based Hezbollah and 26 in July from Hamas ally Palestinian Islamic Jihad.
“Earlier it was Bitcoin and now our data shows that these terrorist organizations tend to increasingly favor Tron,” Mriganka Pattnaik, CEO of blockchain analysis firm Merkle Science, said.
The things that jump out at me are:
How terrorist networks came to use cryptocurrency would be a really, really cyberpunk story if it weren’t so dull…
Tags: Bitcoin, cryptocurrency, Hamas, Hezbollah, Iran, Israel, Jihad, Lebanon, terrorism, Tron (cryptocurrency)
“Israel was still able to seize the money, which seems to suggest that whole “anonymous, untraceable” appeal of cryptocurrency has some fairly sizeable holes in it.”
That is putting it mildly. For the longest time crypto, especially bitcoin’s, biggest selling factor was it’s ‘sovereignty and immunity from government interference’. As if the government doesn’t control A) the electrical grid and B) has a highly developed cyber monitoring and manipulation apparatus connected to SWIFT and every other fiber optic or payment node you could think of.
Seriously, without that you’d be better off just using your smuggling networks – which obviously work in Gaza – to transact in gold or platinum. Without the tangebility of the asset or the ability to convert its value at will, it’s just another speculative commodity essentially controlled by your enemy and being traded on paper in a far away land for a price you could never control.
The seizure doesn’t mean it’s useless; it rather depends on how they seized it. If they seized it because they captured post-it notes with the account’s deets or something similar, it doesn’t mean all that much.
Tron has been around for a while. My understanding of the project is that it is Turing-complete like Ethereum, but its internal programming model more focused on supporting high transaction volumes of tokens, and less on general computing for smart contract/DAO sort of stuff.
My guess is Hamas’ interest in Tron is due to the large amount of dollar-redeemable Tether USDT tokens circulating on the platform. That would provide a liquidity path TRON -> USDT and then USDT -> Eurodollar bank deposit somewhere like Singapore or Dubai (and then, of course, cashing out and living it up like a billionaire). The advantage of Tron over Bitcoin here would be DEXes (programmatic trading platforms that operate without a legal domicile) trading USDT are likely to have better liquidity for the underlying TRON Token compared to having to execute an additional trade (to get a DEX-tradeable token from BTC) or use “wrapped” tokenized BTC (which are likely thin markets).
Cryptocurrencies are not private by themselves, but they can be a tool in a wider operational security plan to keep your personal financial information safe. Like any opsec, you need to know not just the performance of the tool (some cryptos are better than others) but also your needs (hiding a payment for psychiatric help is easier than millions in criminal proceeds) and the threats you face (from abusive family members, to harassing legal process requests, to sweeping extralegal tax grabs, to superpower spy agencies).
You can see this sort of tension in the dark markets, where buyers often want to use Monero (bcause its base-layer privacy makes opsec easy for small amounts) but sellers waht Bitcoin (because the markets for trading out to dollars are much bigger and, having the scale to bribe bankers, they don’t need Monero’s privacy features).
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