Hezbollah cut off from Lebanon Central Bank - Will this increase the group’s crypto reliance?

The recent decision by Lebanon’s central bank to prohibit all interactions with Al-Qard-Al-Hassan, the financial arm of Hezbollah, marks a significant regulatory milestone. While the move tightens the net on Hezbollah’s presence in formal finance, it is unfortunately unlikely to slow the group down. In fact it’s likely to push the group further in their acceleration which is already in motion, towards a deep reliance on crypto-currency. 

Hezbollah, like many sanctioned entities, has a history of adapting quickly. With access to traditional banking now even more constrained, we anticipate a surge in the use of digital assets to raise, move and store funds. The decentralised, pseudonymous nature of many blockchain platforms make them especially attractive for groups seeking to circumvent international oversight. 

Evidence has already demonstrated Hezbollah’s growing use of stablecoins and cryptocurrency in Latin America’s Tri-Border Area,  a region long known as a hotspot for illicit financing and smuggling. According to the Global Network on Extremism and Technology, Hezbollah has ‘long relied on Latin America for money laundering and logistical support, [...] recent years have seen the group shift towards crypto’. The group has allegedly used crypto to avoid detection and bypass the constraints of sanctions.

 Moreover, the Nominis Vue platform regularly identifies wallets involved in Hezbollah’s movement of money, exclusively discovered by the platform alone. 

The above Money Trail identifies wallets that have interacted with a Hezbollah wallet (central node) on the TRON blockchain. The trail demonstrates the involvement with multiple Terror Financing Services, exchanging funds with other critically scored wallets belonging to the services.

According to Nominis CEO Snir Levi - ‘Lebanon’s central bank’s move to block Hezbollah’s access to formal financial institutions is a welcome step in the global fight against terror financing. However, it also marks a likely turning point, as this will drive Hezbollah to deepen its reliance on cryptocurrency as an alternative channel for moving assets.’ 

‘As we continue our mission to identify high-risk wallets and disrupt illicit financial flows, it’s clear that traditional monitoring is no longer enough. Staying ahead of terrorist actors requires adaptive strategies: advanced transaction monitoring, geographic intelligence, and the integration of diverse data sources. Only by evolving our investigative approach can we intercept these wallets before they facilitate terror.’ 

The implications of Banque Du Liban’s Hezbollah ban is clear. As formal financial channels close, the terror group will not retreat, but continue to evolve. Cryptocurrency, when unmonitored, is their favoured solution. Some may believe the answer is to dismiss crypto as a whole, but this is a lazy solution that stifles innovation. In reality, strong transaction monitoring provides an effective solution, protecting the crypto community from exploitation by terror groups.  

Transaction monitoring tools must go beyond simple sanction screening and limited resources. With a likely uptick in terror blockchain activity, platforms such as Nominis Vue represent the most effective way to ensure innocent blockchain users do not become conduits of terror financing, or victims of terror financed by crypto. 

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