Cash, not crypto, still top funding choice for terrorists, Singapore reports

Singapore’s internal investigation into nationwide terrorism threats has revealed a significant reliance on cash transfers for fundraising. In contrast, the adoption of cryptocurrency among terrorist organizations remains low.

The Singapore terrorism threat assessment report 2024, released July 25, highlighted an elevated terrorism threat to the nation owing to global instability. The report was issued by the Internal Security Department (ISD) of the Ministry of Home Affairs (MHA), Singapore.

Bypassing regulations with cash

The Singapore government noted an increase in the use of cryptocurrencies to raise funds for terrorist activities by various Islamist terrorist groups. However, the Islamic State in Iraq and Syria (ISIS) continues to receive most of its funding through cash transfers.

“Although there is increasing use of cryptocurrencies, the predominant means for financial transactions by ISIS and its affiliates remain cash couriers and informal value transfer systems (hawala).”

Wire transfers through financial institutions, money service businesses and cash couriers remain the top choice for terrorist organizations to raise capital. While Singapore reported no indication of an imminent attack, the primary threat driver continues to be online self-radicalization driven by supporters of the terrorist group Hamas.

Crypto donations in terror financing

The report also noted that, in February, a Philippines-based pro-ISIS media group ran a fundraising campaign in support of the “mujahideen (fighters)” and shared posters soliciting cryptocurrency donations.

The agency reminded citizens that funding terrorism is a crime. Since 2015, 13 individuals have been convicted for terror financing, which includes three Singaporeans and 10 foreigners.

Singapore’s ongoing effort to curb terror financing through regulation

The Monetary Authority of Singapore (MAS) recently increased the risk level for crypto exchange platforms or digital payment token (DPT) service providers from medium-low to medium-high as part of an update to the country’s laws on Countering the Financing of Terrorism (CFT).

The change aims to prevent terrorist organizations from exploiting Singapore’s economic openness as an international financial, business and transport hub for terrorist financing purposes.