TRON: The new favorite of the dark web after the BTC

by Tom Wilson and Elizabeth Howcroft Compilation: Aiying

Israel has discovered cryptocurrency cyber TRON in a new counterterrorism battleground

In the new battlefield of global counter-terrorism, Israel faces an unexpected challenge: a rapidly emerging cryptocurrency network called “TRON”. The network has become a new conduit for the flow of funds from Iranian-backed militant groups such as Hamas and the Allah Party.

According to the analysis of trading experts, the TRON network has gradually become the preferred transfer method for terrorist organizations due to its fast transaction speed and low handling fees, surpassing the BTC of the popular choice in the past.

The latest data from Israel’s security agencies shows that they are gradually ramping up their crackdown on TRON wallets, while paying less attention to BTC wallets. The reason behind this shift is obvious: the growing preference of terrorist groups for TRON.

Mriganka Pattnaik, CEO of Merkle Science, explains: "These organizations are increasingly gravitating towards TRON because of its fast transactions, low fees and stability. "Merkle Science serves law enforcement agencies in many countries, including the United States, the United Kingdom, and Singapore.

On October 7 last year, a Hamas attack on Israel killed about 1,200 people. Since then, Israel’s retaliatory actions against Gaza have resulted in the deaths of about 14,000 people. In the wake of this series of events, Israel has stepped up its monitoring of Hamas’s funding sources.

In response to allegations that TRON was being used by terrorist groups, TRON spokesman Hayward Wong said: "All technology has the potential to be misused, just as the US dollar is sometimes used for money laundering. TRON has no control over who uses its technology and has nothing to do with the organizations Israel alleges. ”

It is reported that most of the TRON funds seized by Israel this year are linked to groups it considers to be terrorist organizations, including Hamas, the Lebanese Allah Party and the Palestinian Islamic Jihad. These groups have all been involved in the attacks against Israel. In addition, Israel has seized a number of Hamas-linked currency exchange companies, “Dubai Co”. For Exchange".

Israel froze 600 cryptocurrency accounts suspected of being linked to Hamas during its counter-terrorism operation

A few weeks after the Hamas attack, Israel launched its largest counterterrorism operation to date, freezing about 600 units that had been linked to the “Dubai Co.” Accounts. Although the specific type of cryptocurrency used for these accounts is not officially disclosed, I know from some of the holders of the frozen accounts that they are using the TRON cryptocurrency.

The account holders claimed that they were using cryptocurrencies for business or personal financial needs and denied any ties to Hamas or Islamic Jihad. One of them, Neo, admitted that he may have traded money with individuals associated with Hamas.

The Israeli authorities will “Dubai Co.” Regarded as part of a terrorist organization and claimed that the company provides significant financial support to Hamas’s army every year. I tried to contact “Dubai Co.” His email address appeared in the seizure order, but has not yet received a response.

Since 2019, Hamas’s military wing has been using cryptocurrencies for fundraising. In April, they announced that they would no longer use BTC for fundraising, noting that efforts to stop them from fundraising were increasing. However, in their statement, TRON is not mentioned.

I’ve tried to confirm whether Hamas actually used TRON, but no conclusive evidence has been obtained. Israel’s Counterterrorism Financing Agency also did not respond to questions about how it identified wallets involved in TRON and how they linked them to militant groups. Hamas, the Lebanese Allah Party and Islamic Jihad also did not respond to my queries.

In Israel’s previous announcement of the seizure of TRON wallets, I contacted six named individuals, all of whom denied any association with any radical groups. These people come from different regions, including Venezuela, Dubai, and Jenin City in the West Bank.

Israel freezes funds against Iranian-funded terrorist group, and the TRON cryptocurrency network is in the spotlight

In June of this year, Israel announced that it had frozen a batch of funds that were allegedly intended for use by Iranian-financed terrorist organizations. Iran openly supports Hamas, the Allah Party, and Islamic Jihad, viewing these groups as its “axis of resistance” in the Middle East against Israeli and American influence. However, Israel’s announcement does not make it clear whether the source of these funds comes directly from Iran. The Iranian Foreign Ministry did not respond to a question about whether Iran uses the TRON cryptocurrency to fund these organizations.

A report last year revealed that Iranian companies were trading up to $8 billion through the TRON network, which was seen as a means for Iran to circumvent U.S. sanctions. The transactions took place between 2018 and 2022.

In the cryptocurrency space, while transaction amounts and e-wallet addresses can be traced on the blockchain, identifying the true identity behind transactions remains a challenge. Especially for those who are not in the field of law enforcement or cryptocurrency trading, it is nearly impossible to determine the ultimate destination where the money is going.

The experts I consulted noted that the cryptocurrency “USD” on the TRON network is the dominant medium of exchange. As the world’s largest “stablecoin”, USD aims to maintain a 1:1 ratio of its value to the US dollar, backed by a range of reserve assets. USD company said in its statement that it will actively track down and freeze those “tokens that are used for illegal purposes” and cooperate with law enforcement agencies.

According to CoinGecko, USD is currently the third-largest cryptocurrency by market capitalization, with a market capitalization of $89 billion, an increase of about a third from last year. Although USD may not be well-known outside of crypto circles, it is the primary medium for TRON trading, currently hosting $48 billion in USD. According to Messari, an official website and data company USD, TRON recorded an average of 9.1 million daily transactions from April to June this year, an increase of more than 70% over the same period last year.

Justin Sun, the founder of TRON, was indicted by the U.S. Securities and Exchange Commission in March on charges of selling TRON tokens without registration in order to inflate trading volumes. In response, Sun said the SEC’s allegations were “untenable.” In response to these allegations, Sun’s representative, Deng Binbin, suggested that I refer to the statement of TRON spokesman Wang.

From BTC to TRON: New Trends in Cryptocurrency Financing for Terrorist Groups

Since its debut in BTC 2008, cryptocurrencies have continued to attract the attention of criminals. According to cryptocurrency tracker Chainalysis, the percentage of all crypto transactions illegitimate fell to 0.2% in 2022, compared to 2% three years ago.

Israel’s counter-terrorism operations show a trend change. In 2021, they froze 30 BTC accounts, but in the years that followed, the freezing of BTC accounts almost stalled. In contrast, transactions on the TRON network have attracted more attention.

The International Financial Action Task Force (FATF), a Paris-based G7 agency, recently issued a warning that terrorist groups are seeking to make their donors more anonymous, with USD trading on TRON in the spotlight due to its growing popularity.

Some experts say that as law enforcement agencies become more capable of tracking BTC transactions, these organizations are turning to TRON.

Shlomit Wagman, a senior fellow at Harvard University, previously served as director of Israel’s Anti-Money Laundering and Counter-Terrorism Finance Agency from 2016 to 2022. She noted that TRON initially didn’t get much attention from blockchain analytics firms and was seen as a “neglected corner.”

Analysis by US investment firm VanEck shows that TRON transaction fees are much lower than BTC. Wagman added that activist groups prefer to use stablecoins on TRON over more volatile BTC as a way to “protect the value of their cryptocurrency.”

So, today I’m going to introduce you to TRON, a cryptocurrency network that may be being used by terrorist groups for financing. Although TRON may not be well known to the general public, that doesn’t mean it doesn’t exist. That’s the story I’m going to share today.

Source: Golden Finance