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Investigators in the Philippines track terrorists’ use of cryptocurrencies

May 21, 2020

A report published by the Philippine Research Institute for Peace, Violence and Terrorism (PIPVTR) shows this Islamic State (IS) -related terrorist groups in Southeast Asia recently made their first cryptocurrency transactions.

According to the report released on May 20 The funds help finance regional terrorist groups such as Jemaah Ansharut Dalauh and the Mujahideen of East Timur in Mindanao..

Coin laundering

The report described the use of cryptocurrencies in a money laundering that, according to PIPVTR, consisted of two phases. The first was that crypto assets of “suspicious origin” were executed on unidentified exchanges. This deliberately “obscured” the transactions and origins of the coins and made it difficult to track them down.

Investigators in the Philippines track terrorists’ use of cryptocurrencies
Investigators in the Philippines track terrorists’ use of cryptocurrencies

Regarding the second phase, in which the money laundering cycle ended, the PIPVTR did the following:

“The second phase concerns the exchange of these crypto assets for fiat money, which then returns the funds to the legal money cycle. They can exchange with each other on cryptocurrency-only exchanges.”

The study warns of this Southeast Asian terrorist groups can trade cryptocurrencies outside of regulatory oversightThis is a matter of concern given the weak legal framework.

The institute urges the authorities to use anti-money laundering and terrorist financing procedures for cryptocurrencies because the system is fragile and they accuse the government of losing control of financial flows.

Concerns about “anonymous crypto assets”

The report cited the case of the siege of Marawi in 2017, with unconfirmed reports of private transfers and cryptocurrency transfers to fund the terrorist groups involved. The authorities “largely ignored” these reports.

The PIPVTR was also concerned about the increasing use of “anonymous crypto assets”.like Monero (XMR), that make it easier to disguise illegal activities.

Cointelegraph reported in March on a U.S. ISIS supporter who received a 13-year sentence in 2017 for funding the terrorist organization with cryptocurrencies, including Bitcoin.

However, Chain analysis, the blockchain analytics company, A report was released today that exposed numerous stories about terrorist groups using cryptocurrencies. The report says that many messages on the subject were based on incorrect information.