Gaza Now Cryptocurrency Funding

Even though Gaza Now used extensive fundraising methods, their crypto initiatives were just a small fraction of their overall undertakings. Analysis by Elliptic on the blockchain showed that around $21,000 in donations had been given to Gaza Now in crypto after the incident on October 7.  Additional findings from TRM Labs’ 2023 Illicit Crypto Economy Report echo the results of Elliptic, showing that cryptocurrency donations to organizations such as Hezbollah and ISIS usually are tiny. It is mentioned in the report that most of these contributions were under $500, with a good portion under $100, and a meager part above $5,000.

Cryptocurrency as the Financing Source of Terrorism

The TRM Labs report also noted the cryptocurrency preference among terrorist financiers, noting an 807% rise in use of Tether (USDT) in the TRON blockchain. This preference can be associated with the low costs of transaction in TRON, its stable prices, and an apparent difficulty in tracing transactions. Regardless of these preferences, the level of cryptocurrency use in terrorism financing is small, with the report emphasizing that most crypto donations are of low value.

The moves against Gaza Now and its allies are one of the tactics that the U.S. and U.K. are using in order to block funding routes to Hamas.

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Additionally, this registration facilitates PayPal in endorsing its crypto-centric communications, aligning with the newly established marketing guidelines. It’s worth noting that to align with these regulations, PayPal had previously suspended crypto transactions in the U.K. temporarily.

Restrictions and requirements outlined by FCA

According to the FCA’s official records, the approval granted to PayPal comes with specific stipulations regarding the financial services it can provide. For instance, PayPal is restricted from expanding its existing crypto offerings. Such limitations encompass a range of services, including cryptocurrency exchange services, participation in initial coin offerings, staking, and decentralized finance functionalities, such as lending and borrowing. Moreover, the FCA’s directives also mention that PayPal should refrain from adding new customers and can only allow its current users to hold and sell functionalities. Notably, PayPal stands as the fourth entity to secure the FCA’s crypto registration this year, joining the ranks of Interactive Brokers, Bitstamp, and Komainu. This achievement for PayPal follows its decision to briefly halt its U.K. users from purchasing cryptocurrencies like Bitcoin in the earlier part of October. PayPal had communicated in August its intention to be compliant with the country’s evolving regulations.

The U.K., in recent times, has been establishing its position as a dominant player in the cryptocurrency arena. Reports from October 2023 by blockchain analysis enterprise Chainalysis highlighted the U.K.’s prominence in the crypto sector, particularly concerning raw transaction volume across Central, Northern, and Western Europe. Furthermore, a February 2023 study conducted by the crypto tax platform Recap identified London as the globe’s leading city in terms of crypto readiness for businesses.

As the U.K. continues to be a significant hub for cryptocurrency activities, it remains crucial for major players like PayPal to navigate the regulatory landscape effectively, ensuring secure and compliant operations for their user base. However, with the FCA’s clear guidelines and the proactive approach of companies in the sector, the future of crypto in the U.K. looks promising.

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