Terrorist groups such as Al-Qaeda, the Islamic State and others have unsuccessfully tried to raise money through cryptocurrencies such as Bitcoin, a former CIA analyst told Congress on Friday per Forbes. "By preparing now for terrorists' increasing usage of cryptocurrencies, the U.S. can limit the ability to turn digital currency markets into a sanctuary for illicit finance," said Yaya Fanusie in prepared testimony to House Financial Services Committee. According to Fanusie, cryptocurrencies have thus far been a poor form of money because they purchase goods and weapons with hard cash in places that have unreliable technology infrastructure. (Think Syria, Iraq and Africa.) For jihadists, cash is also more anonymous method of funding. Three Takeaways By U.S. Lawmakers On Sept. 7, a few days before September 11 remembrance services on Capitol Hill, several experts laid out how terrorist groups are securing funding for their operations. The congressional committee made three conclusions, per its website. First, "The threat of terrorism is continually evolving with an increasing number of groups around the world threatening the United States" and "efforts to combat the financing of terrorism are a central pillar to combating all forms of terrorist activity." Finally, the "threat from terrorism and terrorist financing requires constant vigilance and adaptation by law enforcement, financial institutions, and regulators." The House Financial Services Committee oversees the financial services industry, including the securities, insurance, banking, and housing industries. It's chaired by Rep. Jeb Hensarling (R-TX) and notable members include Rep. Peter King (R-N.Y.), Keith Ellison (D-MN) and Maxine Waters (D-CA). Yaya Fanusie is director of analysis for the Foundation For Defense of Democracies Center on Sanctions and Illicit Finance. Other Experts Weigh In "There is no doubt that IS (Islamic State) has represented a unique terrorist financing challenge â¦. [It necessitates] efforts to understand how terrorist organizations continue to adapt their financial structures and design of increasingly sophisticated measures to counter them," Katherine Bauer of Washington Institute for Near East Policy told lawmakers on Sept. 7. "Many terrorist groups attempt to avoid the formal financial systemâ¦ their transactions could potentially intersect with various touch points, including correspondent banks in the region. Therefore, bank regulators and financial intelligence units of partner nations must be intimately involved in monitoring and identifying suspicious transactions," said Colin P. Clarke of RAND Corporation. Iran Trying To Circumvent Sanctions Meanwhile, Iran is using blockchain and cryptocurrencies to try and circumvent U.S. sanctions. This summer, the Islamic regime said it would develop a national cryptocurrency and blockchain-based infrastructure. This was Tehran's response to the Trump administration announcing earlier this year that it would reimpose sanctions and withdraw from Iran nuclear deal. Bitcoin is seeing growing adoption in the Middle Eastern country of 80 million people where the unemployment rate stands at 11.9% and inflation at 8.3%, according to TradingEconomics.com. Sanctions are having a crushing effect on Iran's economy, placing mounting pressure on Tehran's violent regime. "Bitcoin gambling sites, 'mixers' and European Bitcoin exchange may be the destinations of choice for criminals looking to launder bitcoins," wrote Fanusie in the Jan. 2018 study "Bitcoin Laundering: An Analysis of Illicit Flows into Digital Currency Services." Mixers are online software tools that obscure Bitcoin transaction history. The study's authors found that digital currency conversion services in Europe are used to conduct illicit Bitcoin transactions â more than five times as much as similar services in North America. Another problem is that such services often conceal their locations. Fanusie suggests the creation of Commission for National Digital Currency Preparedness to help the U.S. government address the risks and strategies needed involving financial technologies. "Bitcoin exchanges received the greatest amount of identified illicit bitcoins out of all digital currency conversion services," wrote the former CIA analyst. Articles by Marvin Dumont: Google Enters Blockchain: Does It Threaten Amazon, IBM, Microsoft? 550 Bitcoin Price: Palace In Malta, Rolls-Royce Available For Epic Purchase Cyber Criminals Are Finding Ways To Steal Your Cryptos Bitcoin Insider Trading? $74M Short-Sell Is Suspicious: Expert Cryptos To Reach $3.6 Trillion In 10 Years, Bitcoin At $143,000 Disclaimer: The views expressed in this article belong solely to the author. Information contained herein should not be construed as investment advice.