Hamas Wing Told Donors to Skip Binance, Court Filing Shows

A U.S. Department of Justice asset-seizure warrant has disclosed a letter in which the Al-Qassam Brigades, the military wing of Hamas, instructed donors to avoid Binance when moving funds and to use Trust Wallet, Bybit, OKX, Kast and Redotpay instead. The document, dated Feb. 10, 2025, also recommended donors rely on Tether’s USDT stablecoin on the TRC-20 network built on Tron. The disclosure offers an unusually direct look at how a U.S.-sanctioned militant organization evaluates the compliance defenses of crypto platforms when soliciting money.

The letter did not treat Binance as entirely off-limits. According to the DoJ filing, Al-Qassam Brigades told supporters the exchange could still be used to purchase currency, provided the funds were then moved to other platforms before reaching the group. That nuance suggests the guidance was less a blanket boycott than a workaround aimed at a specific compliance chokepoint — evidence, in itself, of how sanctioned actors adapt their instructions as platforms tighten monitoring.

A Paper Trail With a Longer History

The letter surfaces against a backdrop of years of U.S. scrutiny into crypto’s role in financing Hamas. The Wall Street Journal reported in October 2023 that wallets linked to the group had received roughly $41 million between 2020 and 2023. Separately, the U.S. Treasury had been investigating some $165 million in crypto-linked transactions as potentially tied to Hamas financing before the Oct. 7, 2023 attacks on Israel. That assault dramatically sharpened Washington’s focus on digital-asset channels used by designated terrorist organizations, feeding into broader forfeiture actions — including a separate case detailed in a DoJ effort targeting $61 million in Tether tied to Iranian oil sales.

Treasury’s 2026 terrorist-financing risk assessment, cited in the DoJ materials, found that Hamas and ISIS continue to use digital assets, even as traditional financial channels — cash couriers, informal transfer networks and conventional banking — remain their preferred method of moving money. That detail matters: it tempers any narrative that crypto has become terrorist groups’ primary tool, while confirming it remains one option among several that compliance officers and regulators must keep watching.

What the Exchanges Say

The companies named in the letter pushed back on the implication that their platforms are conduits for militant financing. OKX said the specific wallet address cited in the DoJ document was not affiliated with its platform and had already been internally flagged as linked to illicit activity, meaning any funds routed there would likely have been intercepted by its own screening systems. Binance, for its part, framed the letter as a vindication rather than an indictment. Noah Perlman, the company’s chief compliance officer, said the fact that Al-Qassam Brigades warned its own donors away from the exchange demonstrates that its controls are working as intended.

That argument cuts both ways. It suggests Binance’s transaction monitoring has become sophisticated enough that a militant organization would rather instruct followers to use it only as a brief on-ramp than risk having funds frozen mid-transfer. But it also confirms that determined actors can still route donations to less-scrutinized platforms further down the chain, and that stablecoins like USDT on low-fee networks such as Tron remain attractive for the final leg of a transfer specifically because they are fast, liquid and widely accepted.

Kast, one of the platforms named in the letter, maintains a compliance organization of more than 50 employees, according to the facts disclosed in the filing — a detail that underscores how even newer or smaller platforms are now expected to build out substantial anti-money-laundering infrastructure simply to operate credibly in this environment.

Why This Matters Beyond One Case

The episode lands at a moment when regulators and industry groups are already locked in a broader argument over how much oversight the crypto sector needs. In Washington, the fate of comprehensive market-structure legislation remains unresolved after the Senate blocked the Clarity Act despite assurances from a White House adviser that supporters were confident heading into the vote. Cases like this one — where a terrorist financing letter names specific platforms by their perceived compliance strength or weakness — are likely to feature in that debate, since they offer regulators concrete evidence to weigh against industry claims of self-policing.

Binance also faces a separate civil lawsuit brought by victims of the Oct. 7 attacks, adding legal exposure that runs parallel to the reputational stakes raised by this disclosure. For everyday users and institutions relying on these platforms, the takeaway is not that crypto donations to terrorist groups are surging, but that compliance teams, prosecutors and courts are now generating a much more granular record of how illicit actors actually choose between exchanges — information that will likely shape future screening rules and enforcement priorities.

What to Watch

• Whether the DoJ pursues further asset-seizure actions tied to wallets or platforms named in the Feb. 10, 2025 letter.
• How Binance, Bybit, OKX, Kast and Redotpay adjust public compliance disclosures in response to being named in a terrorist-financing document.
• Whether Treasury’s next terrorist-financing risk assessment shows any shift in the balance between crypto and traditional channels used by Hamas and ISIS.
• Progress in the civil lawsuit against Binance brought by Oct. 7 attack victims.

Source: CoinDesk

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