Tron, a blockchain network that allows trading of stablecoins Tether (USDT) and USD Coin (USDC) as well as its native token Tronix (TRX), is now said to be the leading platform for transfers associated with terrorist groups Hamas and Hezbollah.

Israel actively pursues accounts it claims are linked to the terror groups that are active in Palestine and Lebanon through its National Bureau for Counter Terror Financing of Israel (NBCTF). According to Reuters research, 87 Tron wallets have been seized this year for these alleged links, totalling nearly two-thirds of the total Tron seizures since they began in late 2021.

NBCTF declined to comment to Reuters as to how it linked these wallets to the terrorist groups. Without transparency from NBCTF, it is impossible to know the value stored in the wallets seized or how legitimate the links found are. There is a possibility that the money in these accounts will be seized and used for state purposes, as happened in May of this year when the Israeli government seized the assets of over 80 accounts stored on Binance, the world’s largest crypto exchange, transferring the money to state coffers.

NBCTF has not yet responded to a request for comment by Electronic Payments International.

The bureau also froze around 600 accounts it linked to a mysterious company called the Dubai Money Exchange, which is in fact based in Gaza, Palestine. It has been designated a terrorist organisation since March 2022, and its owner is allegedly “a key figure in Hamas’ economic infrastructure.”

Why Tron?

Hamas stopped soliciting donations via Bitcoin in April due to increased scrutiny of donors. Tron, which is newer, smaller and faster than the Bitcoin network, offers an alternative. It also allows trading of USDT, which is a much more stable currency than Bitcoin with similarly high liquidity, making it a popular choice for scammers and fraudsters.

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When asked by Reuters about the chain’s role in this alleged financing, a spokesperson for Tron said that it could “in theory be used for questionable activities” but noted that the same could be said for all technology.

The chain is also growing in popularity generally, boasting over 6.7 billion transactions that update in real-time on its website. It claims to be the world’s fastest-growing public chain.

There is a growing interest in blockchain among financial services Israeli firms, though the number of mentions within company filings remains lower than its peak in 2018.

Our signals coverage is powered by GlobalData’s Thematic Engine, which tags millions of data items across six alternative datasets — patents, jobs, deals, company filings, social media mentions and news — to themes, sectors and companies. These signals enhance our predictive capabilities, helping us to identify the most disruptive threats across each of the sectors we cover and the companies best placed to succeed.