Islamic State Receives Millions In Bitcoin Donations

The Islamic State is rumoured to be banking a massive hoard of Bitcoin, the controversial cryptocurrency only available online.

Outside of the control of governments and central banks, Bitcoin is tough to track online and makes shifting money easier for the shadow organisation.

Bitcoin was introduced by computer programmers as a way to exchange and move money without interference from regulators and tax authorities, but has often been adopted by criminal organisations.

The Silk Road was dismantled by the US government amid concerns that Bitcoin was used to pay for drugs, weapons and other illegal contraband over the internet.

Secret donations

Bitcoin exchanges that hold electronic wallets for consumers have also come under attack from hackers and fraudsters who have stolen millions of pounds worth of what is described as a currency only the holder can unlock.

Now, the Islamic State is said to have been collecting private donations denominated in Bitcoin.

According to the EU Institute for Security Studies (EUISS), private donations are a major source of revenue for IS and Bitcoin helps move the illicit money quickly and secretly to the organisation’s accounts.

EUISS has tried to track the Islamic State’s Bitcoin transactions and reckons at least £2 million is held in a single account and that almost £15 million has been received in donations in the past month.

Teenage Bitcoin expert Ali Amin, 17, was arrested in the US and jailed for 11 years for teaching Islamic State supporters how to transact with Bitcoin and other cryptocurrencies online.

Hacker task force

He had promoted the militant organisation’s use of Bitcoin as trading in the currency allows Islamic State to pay for goods and equipment without resorting to dealing in foreign currency.

Besides the battle in the Middle East to defeat the Islamic State, hackers are also taking the terror group on the internet.

Computer experts around the world have formed Anonymous and Ghost Security to fight Islamic State supporters and fund raisers online.

So far, they have taken down more than 500 web sites and announced a special action force of hackers is dedicated to block Islamic State propaganda online in a bid to slow down recruitment of so-called freedom fighters.