The Islamic State has uploaded its first NFT. Experts believe that the terrorist organization Daesh plans to use the blockchain as a propaganda tool and a new funding tool.
The Islamic State, the terrorist organization also known as daesh, turns to the non-fungible token (NFT) market. quote ” former senior US intelligence officials”, the Wall Street Journal reveals the presence of an NFT titled “IS-NEWS #01” on various digital works exchange platforms. Specifically, the token appeared on Rare and Open Sea.
The NFT bears the emblem of the Islamic State, which is the seal of Muhammad. There is also text in Arabic praising a terrorist act against the Taliban. According to information from the Wall Street Journal, the NFT uploaded by a Daesh . supporter. It would be an experiment aimed at: ” testing a new outreach and fundraising strategy”.
“It’s really an experiment to find ways to make content indestructible”says Raphael Gluck, co-founder of the American research agency Jihadoscope, at the cradle of the discovery of the NFT.
The same internet user posted the NFT of a bomb-making tutorial and an anti-smoking warning. Indeed, the Islamic State formally bans the cigarette. The NFT IS-NEWS #01 has not yet been exchanged for cryptocurrency. It is also not for sale.
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NFTs, a propaganda tool for Daesh?
Asked by the Wall Street Journal, intelligence experts believe IS-NEWS is #01 the first in a long line of NFTs denounce Islamist ideology. According to them, blockchain technology, on which NFTs are based, is a propaganda tool of choice for terrorists. Indeed, the blockchain is resistant to censorship. It is therefore impossible to delete the works stored there.
“It’s as censorship-resistant as can be. There is really nothing anyone can do to remove this NFT”explains Mario Cosby, a former federal analyst who specializes in blockchain and cryptocurrencies.
Unsurprisingly, exchanges reacted to the discovery of NFT. OpenSea, the industry’s best-known marketplace, has the user account and the NFT . deleted. The platform to be set up ” a zero-tolerance policy for content that incites hatred and violence”. We also noticed that the NFT is not accessible through the search engine on Rarible.
However, these measures are not sufficient to prevent the distribution of content. Once registered on the blockchain, NFTs cannot be deleted without the permission of the owner. It is only possible to reduce its visibility. Some decentralized protocols, such as: the interplanetary file system (IPFS), are also able to store NFTs on different nodes (servers). This decentralized approach prevents a third party from making content disappear. In addition, the owner of IS-NEWS #01 ensured that his non-fungible token was registered on IPFS, the Wall Street Journal investigation underlines. So it is impossible to make it disappear.
According to the Wall Street Journal, Daesh officials are looking for alternative financing solutions after the closure of several fundraising websites. This is why some proponents would take a keen interest in blockchain. With NFTs, terrorists may have found a new way to hoard money under the noses of authorities, intelligence experts warn.
The financing of terrorism thanks to cryptocurrencies?
Note that the Islamic State has been using cryptocurrencies to fund itself since the early 2010s. As early as 2015, analyzes showed that Daesh had managed to a big crypto asset war chest, including Bitcoin. In 2015, an IS portfolio would have raised $23 million in one month, German media Deutsche Welle reported. An investigation conducted by the New York Times in 2019 shows that many other terrorist groups are also dependent on cryptocurrencies. This is the case of Hamas, a Palestinian Islamist movement.
Transactions via most blockchains are: easily traceable. De facto, authorities can easily trace the history of transactions and determine which wallets have sent money. On the other hand, the authorities cannot freeze the assets. Unlike money in a bank account, cryptocurrency on the blockchain cannot be frozen or seized by law enforcement.
Crypto assets thus remain assets for criminal organizations, such as Daesh. Nevertheless, terrorist financing a small part of transactions on blockchains. A study by CipherTrace, a company specializing in blockchain analysis, found that illegal activities accounted for only between 0.10% and 0.15% of all cryptocurrency transactions in 2021.
Most of the financing of terrorist groups continues fiat currenciessuch as the dollar or the euro. As Sigal Mandelker, former Secretary General of the United States Treasury Department, explained in 2019: “ most terrorist groups rely mainly on the traditional financial system and cash to transfer their money ». For example, the Islamic State finances itself through oil, gas, speculation in Middle Eastern foreign exchange markets, agriculture and taxes imposed on the population. In this context, Daesh mainly recovers cash and raw materials.
Wall Street Journal