Many recent news articles have been speaking of the high possibility that ISIL is now using Bitcoin for funding. Officially it’s an unconfirmed rumor, but here are some reasons that terrorist groups such as ISIL are attracted to bitcoin.
One of the main factors in this equation is the anonymity of the people sending and receiving bitcoin transactions. Higher-ups within the US government are looking for ways to better regulate suspicious transactions. Also, because bitcoin is a digital currency it’s very quick and easy for it to jump global and national borders without being noticed. The fear is that US-supporters of the islamic terrorist group is enabling ISIL initiatives.
Another reason groups like ISIL are turning to alternate currencies is because the government has be cracking down on potential terrorist related accounts, also, social media websites have also been doing their best to shut down accounts with associations to these groups. This causes ISIL to find alternate forms of funding.
Another factor playing a roll in this is the success of Silk Road. Silk Road was an online marketplace, run on the dark web, offering almost anything, especially illegal drugs, but also other items such as weapons and stolen credit card numbers. The main currency used on the Silk Road website was Bitcoin, however it was eventually shut down by the FBI, although many copycat websites have sprung up since. These terrorist groups saw the darker potential of alternate currencies, which is why it should come as no surprise to us that that terrorist groups are also taking advantage of the anonymity aspect of the currency. At this point, this would only contribute a small amount to their overall campaign; they’re definitely not being funded entirely by bitcoin. They receive most of their money from hostage ransoms and illegal oil sales. Some people are worried that although it’s only a small amount now, it could grow and become a trend within these groups; they’re paying attention to the technology to see if it could be a viable alternative to current methods of securing funds.