Tag: currencies

Is cryptocurrency helping Hamas fund terrorism?

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The US and Israel have stepped up their efforts to limit cryptocurrency transfers to Hamas since the group’s brutal October 7 attacks on Israel. Bitcoin, Dogecoin and Ethereum are increasingly blamed as conduits of funding for Islamist groups, but to what extent is this justified?

In the wake of Hamas’s attacks on Israeli territory on October 7 that were unprecedented in scale, the role of digital currencies like Bitcoin and Dogecoin and crypto exchange platforms in financing the radical Islamist movement are increasingly under scrutiny.

On October 19, the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) proposed new regulations identifying “Convertible Virtual Currency Mixing (CVC mixing) as a class of transactions of primary money laundering concern … to combat its use by malicious actors including Hamas [and] Palestinian Islamic Jihad”.

These online services, known more casually as “mixers” or “tumblers”, mix cryptocurrency of illicit origin with other cryptocurrency funds. As such, “the risk of employing crypto mixers to launder money or conceal earnings is pretty considerable”, acknowledges crypto industry news site Cointelegraph.

Appeals for Bitcoin via Facebook, Instagram and Telegram

In the wake of the October 7 assault, the Israeli defence ministry claimed it had seized virtual wallets linked to Hamas that had received $41 million (€39 million) between 2019 and 2023. The Palestinian Islamic Jihad group, for its part, has raised $94 million (€89 million) in cryptocurrency in recent years, according to Elliptic, a British firm that analyses virtual currency transactions.

And that’s not all. Washington also decided on October 18 to sanction “Buy Cash”, a Gaza-based company accused of “facilitating” cryptocurrency transfers to Hamas and Palestinian Islamic Jihad.

“Hamas’s use of crypto first came to light in January 2019,” writes David Carlisle, co-founder of Elliptic, in a blog post published on October 11. The al-Qassam Brigades, Hamas’s armed wing, was caught red-handed while organising a call for Bitcoin donations via Facebook and Instagram. 

At first, these “funding 2.0” initiatives only raised a few thousand dollars, but Hamas has increasingly used social networks as funding channels ever since. And the Palestinian group formally listed as a terrorist organisation by the EU and the US is not alone in its actions. “Using crypto in conjunction with social media platforms – Facebook, Instagram, and I’ve seen Telegram mentioned recently – has become quite popular,” says Nicholas Ryder, a professor of law and specialist in terrorist financing networks at Cardiff University.

The recent attention paid to funds transferred to Hamas in Bitcoin and other cryptocurrencies may give the impression that without this windfall, the Islamist movement would be bankrupt or would, at least, have had a much harder time financing its attacks on Israel.

Secondary means

“There is a degree of hyperbole about this topic. It’s relatively new, has cachet and is unknown by many people, so of course it attracts attention. You cannot ignore it, but if you think about the pros and cons of [using it for] raising or moving funds, crypto is not the best,” says Tom Keatinge, director of the Centre for Financial Crime Research and Security Studies at the Royal United Service Institute, one of the UK’s leading think tanks on security issues.

For example, Hamas, which Forbes magazine ranked in 2014 as “one of the richest terrorist groups in the world”, has an estimated annual budget of nearly $1 billion. Most of the money comes from “expatriates or private donors in the Gulf region”, points out German news channel Deutsche Welle.

In this respect, the $41 million in cryptocurrencies seized by the Israeli authorities may seem like a drop in the bucket for Hamas. What’s more, these amounts should be taken with a grain of salt: it can be very difficult to separate funds intended to finance terrorist activities from others in a virtual wallet, Chainalysis, an American blockchain analysis company, notes in a blog post.

“[It’s] impossible to quantify how much money is transferred via crypto, but it has become a more and more prominent funding method,” says Ryder.

The rise of Bitcoin, Ethereum and Dogecoin in the world of terrorism can be explained first and foremost by the simplicity of making a transaction, notes Keatinge: “It’s easy, and I can make a donation from my couch at home.” It’s also much quicker than having to open a bank account and find intermediaries willing to transfer the fund. “You just need a smartphone and/or a laptop,” adds Ryder.

International authorities are also putting more effort into countering traditional terrorist financing channels, so these groups are trying to compensate with new ways of raising money. “The more we put pressure on traditional ways of financing, the more they’ll find alternative ways like crypto. And we are becoming better at fighting against the traditional means of financing. It’s like a balloon: when you squeeze one part, the other gets bigger,” says Keatinge.

Not so anonymous

Hamas, al Qaeda and Hezbollah don’t hesitate to combine the best of both worlds, either. For example, there can now be a cryptocurrency dimension to the use of fake NGOs, a classic means of funding for terrorist groups. “They can cut the top 10 to 15 percent and convert it into crypto, and then transfer it in order to make it more difficult to trace,” explains Ryder.

However, these movements’ interest in such new funding methods is not as strong as current media noise might suggest, because they are not ultimately as anonymous as we’ve been led to believe. “It may seem as though crypto is some kind of secret way to channel funds, but it has vulnerability. As soon as you start blockchain transactions, they are traceable. They’re not as secretive as many people think,” says Keatinge.

Indeed, all Bitcoin transactions pass through the blockchain, which is the digital equivalent of a ledger that is accessible to all. Admittedly, the names of those transferring or receiving the funds do not appear, but it is possible to track every movement of funds, and companies such as Chainalysis and Elliptic have become masters in the art of tracing their origin.

Of course, there are ways of making these transactions more anonymous, but they come at the expense of ease and speed – the main advantages of the use of cryptocurrencies for terrorists and other criminals. In the end, it’s still easier and more anonymous to hand-deliver suitcases full of cash.

This article is a translation of the original in French. 

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Chinese postpartum confinement, called ‘zuo yue zi,’ is gaining Western appeal | CNN

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Hong Kong
CNN
 — 

You cannot carry heavy things. You should sleep more. No working. No household chores.

And the list goes on as Carol Chan explained her postpartum instructions for new mom Taylor Richard.

Chan is a “pui yuet,” also called a confinement nanny, who lives with families after a baby is born. She prepares meals and herbal medicines, takes care of the baby and provides guidance on being a new mother.

Richard, a content creator from Canada, traveled to Hong Kong to become a model and fell in love with her husband, Tom, there. They married in November 2018, and Richard gave birth to their son, Levi, in March 2022.

Richard decided to hire Chan, who lived with the family for a month and spent an additional month helping out.

Richard vlogged about her experience with Chan on her YouTube channel, and that video went viral with 2.9 million views. The reaction was mostly admiration and praise from Richard’s primarily Western followers.

The concept of Chinese confinement — “zuo yue zi,” or “sitting the month”— is when a new mother stays at home for one month to allow her body to rest after giving birth.

During that time, the pui yuet makes dishes catering to the mother’s physical needs and helps her with milk production and other concerns. The pui yuet also cares for the mother with massage, body wraps and lessons on how to take care of the new baby.

Richard and Chan declined to share the cost of Chan’s services. Few entities track the pricing of nannies in Hong Kong on a consistent basis because most negotiations are directly between clients and the nannies.

The estimated cost for a pui yuet in Hong Kong ranges from 63,800 Hong Kong dollars (US $8,100) to 268,000 Hong Kong dollars (US $34,100) for 26 to 30 nights for a live-in nanny, according to a 2021 survey by the Consumer Council, a statutory body in Hong Kong dedicated to protecting consumer rights. The council, which surveyed 19 companies or organizations that provide postnatal care, also reported that the cost of a pui yuet working eight hours a day for 26 days ranges from 21,000 Hong Kong dollars (US $2,600) to 34,000 Hong Kong dollars (US $4,300).

This tradition isn’t without criticism, and some have questioned whether the traditional methods of confinement in the Chinese community are too extreme and may be dangerous. In 2015, a new mother in Shanghai following the custom died of heatstroke after wrapping herself in a quilt and turning off the air conditioner, state media reported.

Chan has gotten calls from the US and UK to be a pui yuet after a YouTube video about her went viral.

In recent years, some people have adapted the tradition to more modern ways, taking advantage of available technology. It’s important to turn the air conditioner on when the weather is hot, Chan said, or else you could get sick. The traditional practice had been to avoid anything cold regardless of the weather.

Richard, now 34, said she loved the time she spent with Chan.

“It meant everything! My husband and I both don’t have any family members in Hong Kong, and as new parents we were pretty clueless,” she said via email. “Having someone take care of my body and gently guide me through my transition into motherhood made for a very positive beginning of my baby’s life. I’m forever grateful for Carol!”

Richard was the first Western mother whom Chan cared for in her 12-year career. But since Richard’s YouTube video went viral, Chan said she’s gotten calls from Westerners asking for her services from as far away as the United States and United Kingdom. She’s now headed to Vancouver, British Columbia, in July to work as a pui yuet for a family there for a month.

The kind of care Richard received is expensive, whether the new parents live in Hong Kong or elsewhere. One US location, Boram Postnatal Retreat, opened last year in New York City.

“It was very challenging to get the concept received by others,” cofounder Boram Nam told CNN. “It was a lot about the education process — information is abundant up to until you give birth, and the spotlight completely shifts over to the baby — so we get into that discussion, and people get it.”

Cofounder Boram Nam opened Boram Postnatal Retreat last year in New York for new mothers.

But her program comes with a hefty price tag, starting at three nights for $2700.

“This is the price we do need to charge for the level of service that we provide within the guidelines of what postpartum care looks like in the US,” said Nam, adding that she hopes eventually to get services covered by insurance. “We want to make sure this can be accessible by others, by more women, a more diverse group of people.”

Mandy Major, owner of Major Care, a virtual postpartum doula service based in the US, has noticed a lack of postpartum education in her country.

“We have a lack of systematic postpartum here within our health care system,” Major said. “We have a go-go, hyper-productive, hyper-independent culture, but we also don’t have paid leave.”

Richard’s mostly Western followers on YouTube noted that pressure, commenting on the luxury of taking a month off to spend time recovering and connecting with their babies.

“As an American woman who has given birth 4 times and been booted immediately out of the hospital expected to figure it all out on my own, I can undoubtedly say had this been an option, it may have changed my whole mothering experiences!!” one person said.

“I returned to work 2 weeks postpartum in America,” another mother wrote. “I never felt that I was able to fully bond with my child.”

The month of confinement came to an end for Richard last April. In Richard’s YouTube video, Chan holds Levi one last time and passes him back to his mother as she put her shoes on to leave.

Richard’s eyes begin to fill with tears, surprising herself at her emotional reaction.

“I feel like I’m losing a family member,” she says as the door slowly closes behind Chan, according to the video.

Even after the confinement experience, Chan remains close with Richard’s family, stopping by for lunch occasionally and still giving baby advice.

“If I have another baby, I would love to have it in Canada with my family, but I want Carol to come with me if I do!” Richard said in a video chat later, smiling. “I can’t imagine going through this again without her.”

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Will Turkey’s inflation crisis damage Erdogan’s re-election chances?

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A month before Turkey goes to the polls on May 14, the country’s inflation crisis is a major campaign theme as the six main opposition parties rally around Kemal Kilicdaroglu to create the strongest challenge yet to President Recep Tayyip Erdogan. But analysts say discontent with Erdogan’s economic management will not automatically translate into votes for Kilicdaroglu – especially given the prominence of cultural issues in Turkish politics.

It was telling that Erdogan focused on economic promises when he finally launched his presidential election campaign on April 11, more than two weeks after the secular CHP’s leader Kilicdaroglu. “We’ll bring inflation down to single digits and definitely save our country from this problem,” President Erdogan told his supporters at a stadium in Ankara.

Turkey does indeed need saving from inflation. While growth is robust, the most recent official statistics show inflation running at over 50 percent year-on-year in March, after it reached a quarter-of-a-century peak at over 85 percent in October.

Few doubt that the real figures are much higher: “It’s very clear that the government has been playing with the numbers; the real experience of everyday citizens is considerably more dire,” said Howard Eissenstat, a Turkey specialist at St. Lawrence University and the Project on Middle Eastern Democracy in Washington, DC.

The Turkish lira fell to an all-time low against the dollar in March – the latest of its periodic collapses in the currency and inflation crisis that has racked the Turkish economy since 2018.

Experts blame the crisis on Erdogan’s belief – against all economic evidence – that high interest rates fuel inflation, which has prompted him to cut rates when tight monetary policy is needed to reduce inflation.

‘Really dire’

All this marks a colossal change from the economic outlook in the early years of Erdogan’s rule, back when the Western commentariat lauded him as a forward-thinking reformer.

Erdogan’s moderate Islamist AKP party pulled off an extraordinary feat in the 2003 Turkish elections, overcoming the secularist hegemony cemented in the 1920s by the founder of modern Turkey, Mustafa Kemal Ataturk. The 2001 Turkish economic crisis was a major factor behind the AKP’s victory – and when Erdogan became prime minister in 2003, he set about reviving the economy and turning it into a powerhouse.

Bolstered by IMF support and buoyant conditions in Europe, Turkish GDP growth averaged 7.2 percent from 2002 to 2007. Many voters in Erdogan’s core constituency – working-class, socially conservative Muslims in the heartlands of Anatolia, the Asian part of Turkey – joined the ranks of the middle class.

But over the past five years, the inflation and currency crisis has affected all segments of Turkish society, from Istanbul’s Europhile bourgeoisie to pious, working-class voters in the Anatolian heartland.

“The daily lives of Turkish citizens are being squeezed in very fundamental ways,” Eissenstat said. “People who think of themselves as middle-class are having tremendous difficulty maintaining a basic standard of living. And for the vast majority of Turks who live week-to-week and month-to-month in the best of circumstances, the situation has become really dire; just putting food on the table has become a major struggle.”

Unreliable polls?

Polls suggest the president is losing support in the current economic context. Erdogan and the AKP repeatedly sailed to re-election over the past twenty years – but the latest survey by Mediapoll puts Kilicdaroglu slightly ahead for the first round, at 42.6 percent compared to 41.1 percent for Erdogan.

“I want change,” Selman Deveci, a voter in Konya, a traditionally AKP-supporting territory in the Anatolian heartland, told the Financial Times. “They’ve screwed the economy.”

But Deveci was not impressed with the opposition either: “I don’t have faith in them.”

Analysts say this attitude of disillusionment with Erdogan but scepticism towards the opposition looks to be quite widespread – casting doubt on Kilicdaroglu’s lead in some polls.

“I’m not sure I’m very trusting of the polling,” Eissenstat said. “A lot of outside observers tend to just assume that … because the economic situation is bad, people will jump ship – but not necessarily. I suspect a fair number of AKP voters will return to them, after flirting with the idea of doing something else.”

After all, many Western observers underestimated Erdogan the last time around, in 2018 – expecting then-CHP leader Muharrem Ince to push the president into a second-round runoff after a spirited campaign. Ultimately, Erdogan clinched the necessary majority in the first round with 53 percent, winning 10 million more votes than Ince.

Culture war

The economy’s consequence in determining elections is one of the oldest rules in politics, most famously encapsulated by the cliché “It’s the economy, stupid!”, a mantra for staffers created by Bill Clinton’s campaign strategist James Carville during the successful challenge to George HW Bush for the US presidency amid 1992’s deepening recession. But not every electoral campaign takes place in the kind of context the US had in 1992, when pervasive political tribalism was confined to its past and future.

A fissure has run through Turkish society ever since the early 1920s, when Mustafa Kemal Ataturk severed the profound links between Islam and politics that characterised the Ottoman Empire.

After coming to power, Erdogan slowly but surely brought Islam back into the heart of Turkish public life, eroding the power of Kemalism (so named for the secular philosophy espoused by the republic’s founder) and the “deep state” military-judicial nexus that had long buttressed it.

The anger of Turkey’s largely metropolitan secularists attracted international attention during the 2013 Gezi Park protests in Istanbul – but Erdogan retained his popularity among his millions of supporters in the Anatolian heartland, many of whom welcomed his triumph over the old establishment.

This cultural divide has many different characteristics from those seen in Europe and the US. But “culture war stuff matters in Turkey as it does in the West”, Eissenstat underlined.

And the technological changes of the last decade are amplifying this phenomenon, he added: “In a world of social media – of experiencing the world through news sources of our political choosing – political identification and ideology play a greater role in voting behaviour than before, as we’ve seen not just in Turkey but France, the US and the UK.”

All that said, as the presidential candidate uniting a heterogenous bloc of opposition parties, Kilicdaroglu has adopted a far more pragmatic stance on Turkey’s culture wars than his CHP predecessors.

Last year, Kilicdaroglu shifted the CHP’s position on women’s headscarves, a totemic issue in Turkish politics. Ataturk had discouraged the wearing of headscarves in the 1920s and his successors gradually introduced explicit bans applying at public institutions, which Erdogan then reversed in several stages.

Not only did Kilicdaroglu say the CHP had “made mistakes in the past” by supporting headscarf restrictions, he also endorsed a constitutional amendment upholding women’s right to wear it.

This strategy will make it easier for Kilicdaroglu to emphasise the economy, suggested Ozgur Unluhisarcikli, director of the German Marshall Fund’s Ankara bureau. “The culture war is the main driver of Turkish politics, but not the only one,” he said. “Kilicdaroglu has softened the impact of polarisation with his conciliatory discourse. Therefore the economy will play a more significant role than usual in these elections.”

Return to orthodoxy?

Kilicdaroglu’s economic platform is a return to orthodox monetary policy and central bank independence. Beyond that, the opposition has avoided getting into the nitty-gritty details of economic policy.

But while it is a simple answer to the inflationary crisis, returning to economic orthodoxy is not such an easy sell for the Turkish opposition.

“The opposition is promising a return to confidence and normalcy, but their problem is that confidence and normalcy requires short-term pain,” Eissenstat noted. “That means they’d rather keep the conversation about how Turkey got into this mess, keeping the election as a referendum on Erdogan, without too many questions about what the opposition in power would look like.”

“Providing economic confidence and returning to governing fundamentals is what Turkey needs,” he concluded. “But it wouldn’t necessarily be popular or easy.”

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Small businesses in Lebanon struggle to stay afloat amid lira’s endless fall

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Lebanon’s ongoing economic crisis has left countless individuals and businesses to adapt to the harsh realities of the collapsing economy. FRANCE 24 met with Pierre, an officer in one of the state’s security agencies, and Houssam, the owner of a trendy café in Beirut, who explain the challenges to sustaining their livelihoods.

Before the crisis began in 2019, Pierre enjoyed a comfortable salary of 3 million Lebanese lira (equivalent to $2,000) per month, along with a range of social benefits. However, as the Lebanese lira dramatically collapsed from 1,500 lira to one US dollar (USD) in 2019 to more than 120,000 lira to one USD in 2023, his salary lost 98.5 percent of its value, leaving him in financial straits.

The state’s security agency reduced the working hours of its officers in response to the crisis, requiring Pierre to work only three days a week. Although the state recently tripled his salary to nine million lira, his monthly earnings now barely reach $100 — a mere five percent of his pre-crisis salary.

To make ends meet, Pierre took a second job at Houssam’s trendy café, which pays him in “fresh dollars” (i.e., strong currency, usually USD), ensuring he can sustain his wellbeing amid the country’s deteriorating economic situation and soaring inflation.

Meanwhile, Houssam El Eid, a small and medium-sized enterprise (SME) owner in Gemmayze, a trendy neighbourhood in Beirut, has faced his own set of challenges. His café is a popular spot for young Lebanese and students who flock to Gemmayze for its lively atmosphere, variety of dining options, and the fast internet service provided by Houssam’s café. 

The fast internet is especially valuable for those who need it for study or work, as it is not always available in everyone’s home. Gemmayze is known for its picturesque, narrow streets lined with historic buildings, fashionable boutiques, and vibrant nightlife, making it a must-visit destination for tourists and locals alike.

Houssam’s café in Gemmayze, Beirut, is known for its lively atmosphere, variety of dining options, and fast internet service. © Rawad Taha, FRANCE 24

The currency fluctuations forced Houssam to price his products and services in dollars, protecting his business from the volatile exchange rate. He has also had to navigate the challenges of increased expenses, such as dollarized electricity costs, and staffing difficulties, as skilled workers leave the country for better opportunities. Despite these hurdles, Houssam’s café continues to operate, serving as a lifeline for employees like Pierre who rely on the fresh dollar wages it provides.

“During the crisis, many workers moved from the city to rural areas. At some stage, businesses could not maintain their staff. However, pricing in dollars has allowed us to pay staff in dollars, even though we cannot pay the same salaries as before.”

Speaking on the impact of currency exchange and pricing on SMEs, El Eid says, “Before pricing in dollars, our business was affected negatively on an hourly basis due to the fluctuating exchange rate. The change in the exchange rate made us lose money.” 

“If I sold an item for one dollar,” El Eid explains, “I had to change the price of the exchange from 100,000 to 118,000 lira; if not, I would incur an 8,000 lira loss. However, updating the exchange rate during the day helped mitigate some of these losses.” Before this adjustment, businesses used to price every other week and wait for competitors, resulting in a poorly functioning market.

When asked about the survival of SMEs in Lebanon, El Eid says, “The survival of SMEs depends on various factors. For instance, small markets, grocery stores, and even supermarkets survive because people will always need to buy essentials, even though their spending habits may have changed. The situation differs in coastal areas compared to villages and varies across different sectors and the target audience.”

He notes that high-end and elite brands in the Food & Beverage sector retained their customer base, while smaller shops and commercial chains catering to the masses have been slightly affected. Still, those who were hit the most were businesses catering to the middle class and the youth, as thousands left the country and emigrated.

El Eid also addresses the electricity crisis and its impact on SMEs: “The electricity crisis in Lebanon has been a massive burden, with businesses now paying thousands of fresh dollars, which is not reflected in the prices they can sell at. Previously, electricity and utilities in the Food & Beverage sector should have constituted a maximum of five percent of total sales, but now these costs have risen to above 10 percent.”

He adds that SMEs suffer, and staying in the market is more challenging as a service, that used to cost $10 now costs $7 or less because people can no longer afford it, despite businesses having higher running costs.

El Eid emphasizes the need to define Lebanon’s role in the economy and its prime offerings for the region and the world, questioning what Lebanon should focus on and whether tourism and the crisis-hit banking sector should continue to play a central role or perhaps other sectors should be further developed.

He concludes, “Everything is based on the economy, and Lebanon will continue to struggle without a clear economic direction. Defining Lebanon’s economic identity and creating a strong plan, roadmap, and reforms, and a new political class will be essential for the country’s future progress.”

Pierre shares a similar vision to Houssam’s, and their stories are not unique, as many Lebanese citizens have been forced to find additional sources of income and adapt their businesses due to the economic downturn

“Although my financial situation is dire, I feel it’s my duty to continue serving my country in one of its security agencies,” Pierre said. 

“I remain hopeful that the situation will eventually improve, but deep down, I know that the ruling political elite is corrupt and that real change is desperately needed. I wish the October 17, 2019 protests had been able to bring about real change, but for now, I have no plans to leave the country and leave the rest of my family here.”

 

Lebanon's ongoing economic crisis has left countless individuals and businesses to adapt to the harsh realities of the collapsing economy.
Lebanon’s ongoing economic crisis has left countless individuals and businesses to adapt to the harsh realities of the collapsing economy. © Rawad Taha, FRANCE 24

 

This situation is particularly challenging for those who used to rely on a single, stable income from the government. The crisis has also led to a sharp increase in unemployment rates and the closure of numerous small and medium-sized enterprises (SMEs), exacerbating the financial hardships faced by the country’s population.

As Lebanon struggles to find a solution to its economic woes, individuals like Pierre and Houssam continue to adapt to the new reality, taking on extra work, seeking alternative sources of income, and finding innovative ways to keep their businesses afloat. The resilience of the Lebanese people is evident as they navigate through these challenging times. Still, a long-term solution to the country’s economic problems remains crucial to ensure a better future for all.

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