Cryptocurrency and Terror Financing 

As per the Financial Action Task Force (FATF), crypto assets ‘risk becoming a safe haven for financial transactions of criminals and terrorists’.

Compared to traditional finance, cryptocurrency has relatively less number of regulations. However, some regions are introducing new rules for crypto regulation. 

To send and receive cryptocurrency, a user just needs a crypto wallet, which can easily be set up without the checks and balances one has to undergo for a regular bank account.

Blockchains like Bitcoin and Ethereum maintain a permanent record of transactions. However, there are ways to scramble the traces. 

There have been multiple instances of crypto allegedly being used to finance terror activities. However, as per experts, cryptocurrency is still only a small part of terror financing. 

In 2022, cryptocurrency-related crime hit a record $20.1 billion, which as per Chainanalysis is a lower bound estimate.