Wall Street Journal corrects article misciting Hamas’ crypto terrorism funding data

Elliptic, the firm which Wall Street Journal sourced the data from, said it was “pleased” to see the news outlet acknowledge its mistakes.

The Wall Street Journal (WSJ) has partially corrected an article whic mischaracterized the extent to which Hamas and other militant groups have been funding its terrorism activities with cryptocurrencies.

The Oct. 10 article — titled “Hamas Militants Behind Israel Attack Raised Millions in Crypto” — cited blockchain forensics firm Elliptic to say Palestinian Islamic Jihad (PIJ), a terrorist organization operating on the Gaza Strip, raised as much as $93 million between August 2021 and June 2023.

In the cited report, Elliptic said Israel’s counter-terrorism unit seized PIJ-linked wallets which received $93 million from over that timeframe. However, Elliptic made it clear that this in no way meant that PIJ raised these funds to finance its terrorism activities.

Research from blockchain forensics firm Chainalysis suggests only $450,000 of these funds were sent to a known terrorism-affiliated wallet.

In WSJ’s correction, it stated PIJ and Lebanese political party Hezbollah “may have exchanged” up to $12 million in cryptocurrency — far less than its initial $93 million figure.

“Palestinian Islamic Jihad and Hezbollah may have exchanged up to $12 million in crypto since 2021, according to crypto-research firm Elliptic. An earlier version of this article incorrectly said PIJ had sent more than $12 million in crypto to Hezbollah since 2021,” WSJ said.

WSJ said it updated other parts of the article to include “additional context” about Elliptic’s research.

*Corrections made by the WSJ’s Oct. 10 article. Source: WSJ*

WSJ’s retraction follows an Oct. 25 statement by Elliptic which called on WSJ to correct its misinterpretation of the data. Elliptic added that cryptocurrency funding by Hamas remains “tiny” relative to other funding sources.

On Oct. 27, Elliptic was “pleased” to see WSJ acknowledge its mistakes but said it would've liked to see WSJ be more specific about its corrections.

We're pleased to see the Wall Street Journal issue some corrections to their article based on our feedback. While we would like to have seen them go further, we will continue to engage constructively.
— Elliptic (@elliptic) October 27, 2023

Coinbase's chief legal officer Paul Grewal also noted that WSJ's opening paragraph is still framed as though cryptocurrency was the primary funding source behind Hamas' Oct. 7 attack on Israel.

2/ @WSJ's lede still maintains that the funding supported Hamas attacks hinged on “One answer: cryptocurrency.” There's no evidence of that, and WSJ knows it. pic.twitter.com/BQK80b1jMd
— paulgrewal.eth (@iampaulgrewal) October 27, 2023

"This is barely a correction," he added.

Nic Carter, partner of Castle Island Ventures and others are now calling on United States Senator Elizabeth Warren to retract a related letter backed by over 100 U.S. lawmakers written to the White House on Oct. 17.

The letter cited WSJ’s misinterpreted data from Elliptic in an attempt to argue that cryptocurrency poses a “national security threat” to the U.S. and that Congress and the Biden administration should act swiftly before cryptocurrencies are used to finance another “tragedy.”

Liz Warren wyd? pic.twitter.com/e0Ew2TQzRb
— nic carter (@nic__carter) October 27, 2023

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Crypto donations raised by Hamas ‘remain tiny,’ says Elliptic

Blockchain Forensics

Elliptic’s statement was framed as a rebuttal to recent articles and letters circulating among the media and U.S. lawmakers this month.

Blockchain forensic firm Elliptic says there’s “no evidence” that Hamas is receiving a significant volume of cryptocurrency donations to fund its attacks against Israel.

“There is no evidence to support the assertion that Hamas has received significant volumes of crypto donations,” Elliptic said in an Oct. 25 statement. The amounts raised “remain tiny,” the firm added.

Elliptic’s statement was framed as a rebuttal to recent articles and letters written by The Wall Street Journal and United States lawmakers, which the firm says had misinterpreted data to make the case that cryptocurrency is widely used to fund Hamas’ "terrorist” activities.

As an example, Elliptic pointed to a “prominent” Hamas cryptocurrency fundraising campaign, operated by Gaza Now, a pro-Hamas news outlet, which has only raised $21,000 since the Hamas attack on Israel on Oct. 7.

Of the $21,000 raised, $9,000 was frozen by stablecoin issuer Tether, while another $2,000 was frozen after it was sent to a cryptocurrency exchange — presumably to cash out, Elliptic noted.

Setting the record straight on crypto crowdfunding by Hamas https://t.co/1tZrE1C43V
— Elliptic (@elliptic) October 25, 2023

Elliptic said it reached out to WSJ to correct a statement that initially claimed that over $130 million in cryptocurrency was raised by Hamas and Palestinian Islamic Jihad between Aug. 2021 and June 2023. WSJ later revised the statement to say “as much as $93 million” in an Oct. 10 update.

The WSJ article had been cited in a letter written by Elizabeth Warren and over 100 other U.S. lawmakers to the White House and U.S. Department of the Treasury on Oct. 17.

Warren and other lawmakers argued that cryptocurrency poses a “national security threat” to the U.S. and its allies and that Congress and the Biden administration must take “strong action” to thoroughly address risks with cryptocurrencies in facilitating illicit activity before it can be used to finance another “tragedy.”

However, Elliptic reiterated that its data was misinterpreted:

“Over the past two weeks, politicians and journalists have portrayed public crypto fundraising as a significant source of funds for Hamas and other terrorist groups, but the data simply does not support this.”

~20% of US Congress signed a letter based on incorrect facts. Elliptic just corrected the facts. Will @WSJ & the ~20% of Congress correct their statements now?@nic__carter, thank you for demanding truth here, and holding power accountable for misstatements of fact https://t.co/TazXQnjjgW
— Caitlin Long ⚡️ (@CaitlinLong_) October 25, 2023

On Oct. 18, blockchain forensics firm Chainalysis also posted a blog attempting to address supposed misconceptions circulating in the media. One particular wallet highlighted by media reportedly received $82 million across 7 and a half months, but Chainalysis explained that of that, only $450,000 was transferred to a known terror-affiliated wallet.

Meanwhile, Elliptic also noted that in April 2023, Hamas suspended cryptocurrency fundraising conducted through Bitcoin (BTC), citing a “concern about the safety of donors and to spare them any harm.”

In 2021, Israel’s National Bureau for Counter Terror Financing also began issuing seizure orders for cryptocurrency wallets tied to Hamas and worked with exchanges to freeze accounts used by them.

These events suggest cryptocurrency isn’t an ideal means to facilitate terrorism fundraising, Elliptic argued:

“This illustrates the weakness of crypto as a terrorism fundraising tool. The transparency of the blockchain allows illicit funds to be traced, and in some cases linked to real-world identities.”

Cointelegraph reached out to WSJ for comment but did not receive an immediate response.

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Israel-Palestine Conflict