Wall Street Journal decisively corrects article misquoting Hamas’ influential crypto-terrorism funding statistics
The Wall Street Journal’s Mischaracterization of Cryptocurrency Funding for Terrorism
Introduction:
The Wall Street Journal (WSJ) recently published an article that mischaracterized the extent to which Hamas and other militant groups have been funding their terrorism activities with cryptocurrencies. The article, titled “Hamas Militants Behind Israel Attack Raised Millions in Crypto,” cited blockchain forensics firm Elliptic to claim that Palestinian Islamic Jihad (PIJ) raised as much as $93 million between August 2021 and June 2023. However, a correction has been issued, highlighting the inaccuracies in the initial report. This correction is significant considering the potential impact such mischaracterizations can have on public perception and policy decisions regarding cryptocurrencies.
The Initial Inaccurate Report:
The WSJ article relied heavily on information from Elliptic, stating that PIJ had raised $93 million. However, Elliptic clarified that the funds received by PIJ-linked wallets did not necessarily mean they were used to finance terrorism activities. Further research from blockchain forensics firm Chainalysis revealed that only $450,000 of these funds were sent to a known terrorism-affiliated wallet. This starkly contrasts with the initial claim made by WSJ, which prompted the need for a correction to provide accurate information.
The WSJ Correction:
Acknowledging the misinterpretation of data, WSJ issued a correction stating that PIJ and Lebanese political party Hezbollah “may have exchanged” up to $12 million in cryptocurrencies since 2021. This amount is significantly lower than the previously reported $93 million. WSJ also mentioned that it updated other parts of the article to provide additional context about Elliptic’s research. While the correction is a step in the right direction, it does leave room for improvement in terms of specificity.
Elliptic’s Response:
Elliptic, the blockchain forensics firm whose data was misinterpreted by WSJ, released a statement calling for a correction of the inaccuracies. Elliptic highlighted that the funding by Hamas in cryptocurrencies remains “tiny” compared to other funding sources they employ. The firm expressed satisfaction with WSJ’s acknowledgment of the mistakes but urged for more specificity in the corrections provided. It is essential to accurately frame the scale and impact of cryptocurrency funding for terrorism to avoid misinformation and potential policy overreactions.
Criticism and Calls for Retraction:
WSJ’s opening paragraph, as noted by Coinbase’s chief legal officer Paul Grewal, implies that cryptocurrency was the primary funding source behind Hamas’ recent attack on Israel. Grewal pointed out that there is no evidence supporting this claim, and WSJ is aware of it. This has sparked criticism, with some arguing that WSJ’s correction is insufficient. Additionally, there are calls for United States Senator Elizabeth Warren to retract a related letter she supported, which cited WSJ’s misinterpreted data to argue for cryptocurrency regulations based on national security threats.
Conclusion:
The Wall Street Journal’s mischaracterization of cryptocurrency funding for terrorism highlights the potential dangers of misinformation and its impact on public perception and policy decisions. The correction issued by WSJ partially rectifies the inaccuracies, reducing the reported amount of funds exchanged between PIJ and Hezbollah. However, further specificity in corrections and retractions may still be necessary to provide an accurate understanding of the extent of cryptocurrency funding for terrorism. It is crucial for media outlets and policymakers to exercise caution and thorough fact-checking when addressing sensitive issues like cryptocurrency’s involvement in illicit activities.
