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Bitcoin [BTC] could be the financial ‘savior’ for cash-strapped terror group, Hamas

Jibin M George



Bitcoin [BTC] could be the financial savior for cash-strapped terror group, Hamas
Source: Pixabay

In news that will do little to dissociate Bitcoin, the world’s largest cryptocurrency from its history with the Dark Web and Silk Road, Hamas, the Palestinian terrorist group has announced that it will now accept Bitcoins as donations to its cause. According to the Agence France-Presse (AFP), this announcement was made by a spokesperson of the organization’s military wing.

Hamas, an outfit that now rules the Gaza strip on the border of Egypt and Israel had taken control of the area after a struggle with its bitter rival Fateh and is today, designated a terrorist organization by Israel, the United States and EU. The group which claims to fight for the Palestinian cause has been responsible for several rockets and suicide attacks, especially against the Jewish state of Israel.

The spokesperson, in his statement, said:

“Support the resistance financially through the bitcoin currency”

However, the exact process and mechanism through which such donations would be made was left unsaid and will be announced later, the spokesperson further said.

Hamas’s adoption of the Bitcoin cryptocurrency follows months of financial despondency that has crippled Hamas’s ability to govern Gaza and attack Israel. Using international legal mechanisms, Israel has blocked most routes of finance to Hamas. Iran, Hamas’s main sponsor, is cash-strapped itself as it struggles to float against the wave of US sanctions. In fact, this has forced Iran to relax its regulations on cryptocurrency and a new Rial-sponsored cryptocurrency may soon be in the offing for the Persian state. Hamas’s announcement to accept Bitcoins, therefore, could a follow-through of the steps Iran has been taking.

Interestingly, there has been no uniform opinion of whether Bitcoin and cryptocurrencies are Halal under Islamic Sharia law, applicable through much of the Middle East today.

Although Bitcoin hasn’t reacted to this announcement yet, it would be interesting to see the steps, if any, the cryptocurrency may take. Its degree of security and anonymity has often been used by many to sell or procure illegal substances such as drugs, weapons, and adult paraphernalia. In fact, some studies such as the one conducted by the University of Sydney and the Stockholm School of Economics last year suggested that over 25% of all Bitcoin users are associated with conducting illegal activity. If Hamas is able to use Bitcoin to fund itself then, serious questions would be asked of the cryptocurrency.

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Jibin M George is a graduate in International Relations and Law with a growing interest in the world of cryptocurrency and blockchain technology


Facebook’s Libra ‘sounds an awful lot like Proof-of-Stake’ and will ‘run into Ethereum’s problems,’ claims Jameson Lopp




Facebook's Libra 'sounds an awful lot like Proof-of-Stake' and will 'run into Ethereum's problems' claims Bitcoin engineer, Jameson Lopp
Source: Unsplash

Facebook’s “The Libra Blockchain” whitepaper has created quite a frenzy, not only in the cryptocurrency ecosystem, but also with U.S. government officials. Some people claim that Libra is not a blockchain, while others claim that it is going to kill Ripple, XRP and other similar blockchains. However, Jameson Lopp had a different view, claiming that the Libra blockchain has not solved massive problems that Ethereum has.

Lopp in his Medium article dissected the whitepaper and stated that the Libra Blockchain will be controlled by a set of authorities in a top-down fashion and that it will eventually move from a permissioned to a permissionless blockchain. The blockchain will offer a global currency – Libra coin, which will be backed “with a basket of bank deposits and treasuries from high-quality central banks.”

Since the whitepaper mentions that it will eventually move towards a permissionless and an open system, Lopp speculates that it “sounds an awful lot like Proof of Stake” and like Ethereum, it will face the same problems. He said,

“Apparently the plan is to open up membership after 5 years and hopefully they’ll have figured out Proof of Stake by then… I expect they’ll run into the same problems as Ethereum!”

Lopp added that “Calibra Wallet,” which is used to store the Libra coins, is the only wallet that can hold the coins for now and that it will require strict KYC/AML compliance. Since the blockchain conveniently replaces “stablecoin” for “resources,” Lopp speculates that it will concentrate more on smart contracts since it is built on a custom smart contract programming language called “Move”.

In addition to facing similar problems as those faced by Ethereum, the Libra Blockchain is facing more issues from a political and a regulatory standpoint. There was a lot of speculation even before Facebook dropped the whitepaper.

According to Reuters, United States House Financial Services Committee Chairwoman Maxine Waters issued a statement to halt/pause any and all developments on the project, until and after the Congress and other regulatory bodies have finished reviewing it. A senior Republican, Patrick McHenry, is also calling for a hearing on Facebook’s new cryptocurrency.

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