Terrorists could use virtual currencies to fund their operations.
This is the stark warning contained in the US Treasury Department published 2015 National Terrorist Financing Risk Assessment.
It said the US government has made it harder for the terrorists to use their banking system, which has forced the terrorists to look for alternative payment systems to fuel their efforts.
Virtual currencies make them more vulnerable as they provide anonymity and can be raised through social media. It also highlighted a blog post linked to Islamic State proposed using bitcoin to back up their efforts.
The report said, "multiple terrorist organisations and radicalised individuals seek to exploit several vulnerabilities in the United States and in the US financial system to raise and move funds, that despite ongoing efforts by the US government to mitigate, still pose a residual risk of TF (terrorist financing)."
"A notable trend identified in the charitable sector involves individuals supporting various terrorist groups seeking to raise funds in the United States under the auspices of charitable giving, but outside of any charitable organization recognised by the U.S. government.
"Additionally, the growth of online communication networks, including social media, has opened up new avenues for terrorists and their supporters to solicit directly, and receive funds from, US residents."
The report also highlights the Syrian conflict where social media sites were used as platforms to raise funds for terrorist activities.
US Treasury acting under secretary for Terrorism and Financial Intelligence Adam J. Szubin said: "Today’s assessments underscore our dedication to better understand and address the risk of illicit finance.
"This comprehensive review will better inform the U.S. Government and our private sector partners about how to further safeguard and strengthen the U.S. economy and national security."
