According to director of the Jeanette and Eli Reinhard Program on Counterterrorism and Intelligence at The Washington Institute for Near East Policy, said that while crypto has been connected to several terror financing cases, it has not yet become a primary method of terror financing.
An individual who allegedly sympathizes with terrorists created and distributed the first known nonfungible token (NFT), raising concerns that blockchain technology’s immutability may allow terrorist messaging and propaganda to spread.
An intelligence expert quoted in a September 4 article in The Wall Street Journal (WSJ) said that the NFT may be a signal that Islamic State and other terror groups may also be using blockchain technology to circumvent sanctions and raise funds for their violent campaigns.
According to Jihadoscope co-founder Raphael Gluck, the NFT was reportedly discovered through pro-ISIS social-media accounts, through which he discovered the NFT.
An image bearing the Islamic State’s emblem with text praising Afghanistan-based Islamic militants for attacking a Taliban position is said to be the digital token ‘IS-NEWS 01.’
Mario Cosby, a former federal intelligence analyst specializing in blockchain currencies, said that users created another two NFTs on August 26; one depicting an Islamic State fighter teaching students how to make bombs, and the other warning against smoking cigarettes.
Terrorist organisations may be experimenting with new funding methods and spreading their message through emerging technology, national security analysts said, though the NFT in question had not been for sale nor had it been traded.
Gluck says that creating unchanging content is a experiment.
A poster reportedly listed the digital token on NFT marketplace OpenSea, but the company quickly removed the listing and closed the account, citing a “zero-tolerance policy on inciting hate and violence.”
NFTs were also found on Rarible’s NFT marketplace, as well as several other NFT marketplaces, before being taken down.
According to Cosby, the fact that NFTs have not been traded is cause for concern because “it’s as censorship-proof as you can get,” adding:
Terrorists may fund assaults by exploiting emerging technologies and markets, including NFTs, in the future, security experts have said.
The report from the U.S. Treasury Department in February noted the rapid growth of NFTs as an area of potential concern.
Israeli authorities seized a set of 30 crypto wallets from 12 Hamas exchange accounts in March.
Despite the impact being limited, terrorists still raise funds through crypto.