By Steven Stalinsky* Preface
Nearly 17 years after the 9/11 attacks and the subsequent 9/11 Commission Report recommendations, a Telegram cryptocurrency will shatter all the lessons learned about terrorism financing, and will be used to fund terrorism worldwide. The recommendations stated: "Vigorous efforts to track terrorist financing must remain front and center in U.S. counterterrorism efforts. The government has recognized that information about terrorist money helps us to understand their networks, search them out, and disrupt their operations. Intelligence and law enforcement have targeted the relatively small number of financial facilitators - individuals Al-Qaeda relied on for their ability to raise and deliver money - at the core of Al-Qaeda's revenue stream."
As terrorist groups such as the Islamic State (ISIS) have grown more sophisticated and do much of their fundraising online, it has become almost impossible to follow these recommendations. Telegram's introduction of its own cryptocurrency will allow terrorist groups to easily distribute money, raise funds, and so on. The question is: Can anything be done to stop it? The 9/11 commission report detailed how fundraising for the 9/11 attacks relied on imams and mosques, through hawala (an informal trust-based system of transferring funds) and other fairly primitive means. Cryptocurrencies have already made terrorist fundraising more difficult to track, and with Telegram's and Telegram CEO Pavel Durov's history, the problem will increase by orders of magnitude.Introduction
A white paper "leaked" in early January detailed how the encryption app Telegram aims to join the cryptocurrency craze by adding a "third generation" blockchain with more advanced capabilities than Bitcoin and other existing cryptocurrencies with a mainstream appeal. Pavel Durov, who seeks to raise over a billion dollars for the development of the Telegram Open Network (TON) Blockchain, whose representative cryptocurrency is Gram, and for "the development and maintenance of Telegram Messenger, and other purposes," has already gained the interest of wealthy Internet investors, and has won over many in the leading economic media to his plans.
Following an initial coin offering (ICO), Telegram is on track to raise that billion dollars, reportedly in just four months. As of March 2018, Telegram had taken in $850 million from wealthy venture capital firms, and it reportedly aims to raise another $850 million over the next month and a third $850 million in the round after that, according to documents associated with the offering. Media outlets, including Bloomberg, state that $2.5 billion could be raised. It should be noted that Durov, who, according to Forbes, already has a net worth of $1.7 billion and who created the popular Russian social media platform VK, which is widely used by Russian-speaking jihadis, could see his personal wealth increase dramatically.
Most media reports about the Telegram ICO have either failed to disclose or have downplayed the fact that the Telegram app is the heart and soul of cyber jihad, and is hugely popular with terrorists, particularly with ISIS. Since 2015, when it was used in the November 2015 Paris attacks, it has emerged as jihadis' preferred app for encrypted communications, including planning and carrying out attacks, as arrests worldwide have shown. On March 15, 2018, authorities arrested a Cuban man in BogotÃ¡ who had planned to bomb a restaurant frequented by U.S. diplomats and who had on Telegram communicated his desire to blow himself up for the Islamic State. Just last week, on March 23, ISIS used Telegram to claim responsibility for its attack in the southern French town of TrÃ¨bes (see image below).
Previously based in Germany and London, and registered as a British company, Telegram has tried "a number of locations." Noting that the company is currently in Dubai, Pavel Durov said on Twitter that "we don't consider it our permanent base," but the company is there until "local regulations change." Durov boasts about moving Telegram from place to place to evade government oversight and restrictions over the past two years, and his tweets have been datelined N.Y., U.K., France, Switzerland, and other locations throughout the world. It should, however, be noted that Telegram has servers throughout the West, including in the U.S.
Durov often acts as if he is above the law and deserves immunity from criticism about the terrorists on his platform. Governments worldwide - first the U.S., then the U.K., France, Germany, and others in Europe - have also warned about Telegram as a hub for terrorist planning, recruitment, and daily operations and communications.
In a possible sign of trouble ahead, mounting concern about bad elements investing in Telegram's cryptocurrency have led the company to take some initial precautions. In mid-March, it was announced that individuals on the sanctions lists of the U.S., U.K., European Union, or United Nations, including Iran, will not be allowed to take part in Telegram Open Network initial coin offerings (ICOs), and will be forbidden by the official Telegram group investor agreement from buying Gram cryptocurrency, according to the Russian news agency RBC. The ban extends to all residents of the Crimean Peninsula, Cuba, Iran, the Democratic People's Republic of Korea, and Syria.
In December 2016, MEMRI released its seminal study Germany-Based Encrypted Messaging App Telegram Emerges As Jihadis' Preferred Communications Platform. A year later, Telegram is even more widely used by terrorist organizations. Adding its own cryptocurrency will further increase both its popularity and its use by terrorists - particularly since Telegram has not even begun to seriously address terrorist use of its platform.
On December 26, 2016, one day after MEMRI exposed Telegram as ISIS's and other jihadis' "app of choice" - as described by The Washington Post on its front page on December 24 - Telegram responded by creating its ISIS Watch channel/bot. In daily updates, the account bot notes the number of ISIS accounts Telegram claims to have removed in the previous 24 hours - a number totaling 5,000-8,500 monthly. But Telegram offers no proof that this actually happens, and as an observer of Telegram and of terrorist groups online, I can attest that many accounts that do disappear soon return.
On January 31, 2017, following reports that Telegram was used in the November 2015 Paris attacks, Durov had the audacity to tweet on the matter of Telegram's procedure for removing terrorist content: "We will look into whether such measures are still necessary in 2018." A recent post on Telegram of "guidelines for doing just terror operations" shows how to lethally stab someone and what kind of knife to use, advising throat slashing.
All of the methods of killing described in this official ISIS video, a screenshot from which is shared on Telegram, are performed on a living person until he dies in front of the camera.
Another post this week on the LM WORLDWIDE (Lone Mujahideen) Telegram Channel included "tips for the mujahideen in the enemies' lands," gives specific instructions on what to do before planning, during planning, and in the implementation of an attack, including "strike violently and try to inflict the greatest losses in the enemy" and "keep killing until you are killed."
The following report explains why a Telegram cryptocurrency is a national security threat, detailing the justified concerns of the U.S. and other Western governments about current terrorist use of Telegram and how and why governments have not been able to successfully pressure the company to tackle it. It will also explain how this is going to change with the coming ICO and how terrorists already freely use Telegram for fundraising. The report will offer recommendations for how the U.S. government and Western companies can finally get Telegram to remove terrorist activity from its platform and what measures should be taken if Telegram does not comply.Governments Are Concerned About Terrorist Use Of Cryptocurrencies - But May Be Unaware of The Looming International Security Danger Of Telegram Cryptocurrency
As the value of Bitcoin reached new highs earlier in the year and garnered increased media and other attention, there has been heightened concern from governments worldwide that terrorist groups are using digital wallets to send and receive funds using Bitcoin and other cryptocurrencies. At the same time, as ISIS's physical caliphate crumbles, along with its own once-heralded economy that included its own currency and banks, it is naturally turning to cryptocurrencies. In recent months, French, Italian, Australia, Japan, U.K., and other legislatures worldwide have sought more regulations on Bitcoin and other cryptocurrencies because of potential terrorist usage. In the U.S., there have been bipartisan Congressional hearings and legislation on the matter including in January 2018, when Rep. Ted Budd (R-N.C.) introduced H.R.4752, the Financial Technology Innovation and Defense Act, to establish a task force to combat terrorist use of cryptocurrency. These concerned government bodies worldwide may be unaware of the looming international security danger associated with a Telegram cryptocurrency.
Western Governments Have Not Had The Leverage To Pressure Durov - Until Now
Inexplicably, although Telegram is a major highway for the daily activity of ISIS and other terrorist groups, and has been at the center of multiple terrorist cases worldwide, there has been no significant pressure on Telegram to remove terrorist content. Reasons for the lack of pressure could be that the location of Telegram's headquarters is not available, and Durov's international movements, and those of the company's assets, make it difficult to compel the company to tackle its terrorism problem. The new official cryptocurrency changes all that. As other social media companies, led by Facebook, make tremendous efforts to fight terrorist content online, Durov remains defiant about his platform's popularity among terrorists worldwide, and his responses to accusations are filled with half-truths and snark.Read The Full Report