Argentina Freezes 200+ Crypto Wallets Tied to HTS Terrorism Financing Under 2023 AML Framework

Argentina has taken a significant step in its anti-terrorism efforts by freezing cryptocurrency wallets linked to Hay'at Tahir Al-Sham (HTS), a Syria-based group designated as a terrorist organization by the U.S., U.N., and EU [1]. The Financial Information Unit (UIF) of Argentina, acting on intelligence from international partners, identified transactions involving HTS through a six-month investigation with blockchain analytics firms. The move targets two individuals: a Russian national resident in Argentina and a foreign national previously flagged by the U.S. Treasury and Israel’s National Bureau for Counter Terror Financing [2]. While no evidence of terror activities within Argentina was found, the freeze aims to disrupt cross-border funding streams for ransomware operations and conflict zone activities.

HTS, despite disavowing al-Qaeda in 2016, continues to pursue an extremist agenda focused on establishing an Islamic state through violence. The group’s use of cryptocurrencies allows it to maintain anonymity, funneling funds through ransomware payments and dark web transactions [1]. Argentina’s UIF, in coordination with a federal judge, froze over 200 wallets associated with HTS, citing obligations under the Financial Action Task Force (FATF) to combat global terrorism financing. The frozen assets will be liquidated via court-ordered auctions and allocated to national security programs [2].

The action reflects Argentina’s expanded 2023 Anti-Money Laundering (AML) framework, which mandates heightened monitoring of high-risk crypto transactions. This includes scrutiny of politically exposed individuals and non-profits, aligning with Argentina’s role in regional anti-terror coalitions like the Southern Common Market (SICA) [2]. However, the crackdown has sparked debate within the crypto community. Regulators hailed the move as a “milestone in financial transparency,” but industry advocates raised concerns about due process, noting the lack of prior notification to wallet holders and broad definitions of “terrorism financing.” The Argentine Blockchain Association urged clearer guidelines to distinguish between legitimate crypto use and illicit activity [2].

Globally, Argentina’s approach mirrors a trend of nations integrating blockchain surveillance into AML strategies. The FATF’s 2024 report highlighted Argentina as one of 12 countries leveraging such tools, noting a 30% decline in suspicious transaction reports since 2022. Yet experts caution that decentralized finance (DeFi) and privacy-focused cryptocurrencies remain difficult to track, even with advanced analytics. Argentina’s collaboration with international bodies may enhance its capabilities, but interoperability and enforcement challenges persist [2].

The freeze underscores Argentina’s balancing act between promoting crypto adoption and mitigating risks. Amid the peso’s volatility, Bitcoin remains a hedge for citizens, prompting the government to launch a regulatory sandbox for digital asset startups. However, the recent measures signal a shift toward stricter oversight, particularly as Argentina prepares to host the 2026 G20 summit, where crypto regulation is expected to be a key agenda item [2].

Source: [1] [Argentina Flags Crypto Use Linked to Terror Group HTS] [https://coinmarketcap.com/community/articles/688732a5ccfa7925fe395c43/], [2] [Argentina Freezes Crypto Wallets Linked to Terrorism Financing] [https://news.bitcoin.com/argentina-freezes-crypto-wallets-linked-to-terrorism-financing/]