Rajarshi Mitra
Independent Analyst
- A renowned institute in the Philippines has revealed that terrorist groups in Southeast Asia have recently carried out crypto transactions.
- The funds are reportedly being used to finance regional terror groups.
- The institute has urged the authorities to use anti-money laundering procedures for crypto.
A report by the Philippine Institute for Peace, Violence and Terrorism Research (PIPVTR) has revealed that terrorist groups linked to Islamic State (IS) in Southeast Asia have recently made their initial crypto transactions. According to the report, the funds are being used to finance regional terror groups like the Jemaah Ansharut Dalauh and the Mujahideen Eastern Timur in Mindanao.
The report described the use of cryptocurrencies in a money-laundering operation, which occurred in two phases. The first was where crypto assets of “suspicious origin” were channeled through unidentified exchanges. This “deliberately obfuscated” transactions and the origins of coins, making it more challenging to track them. Regarding phase two, the PIPVTR said:
The second phase refers to an exchange of these crypto assets into fiat money which, then, returns the funds to the legal money cycle. In crypto-only exchanges, cryptocurrencies can be exchanged with one another.
PIPVTR also warned that terror groups in Southeast Asia could trade crypto outside the supervision of regulatory establishments because of the loose legal framework. The institute also called for the implementation of Anti-Money Laundering and Countering Financing Terrorism procedures for cryptocurrencies.
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