Transaction Monitoring (TRM) Labs Releases Report Exposing Islamic State Khorasan Province (ISKP)'s Use of Monero (XMR) to Raise Donations

Transaction Monitoring (TRM) Labs, a blockchain intelligence company based in San Francisco and acknowledged by the World Economic Forum, has recently released a report

Transaction Monitoring (TRM) Labs, a blockchain intelligence company recognized by the World Economic Forum and based in San Francisco, has unveiled connections between Islamic State Khorasan Province (ISKP) and ISIS-affiliated fund-collecting networks in India, in a report released recently.

ISKP, a terror organization based in Afghanistan, is reportedly using the cryptocurrency Monero (XMR) to collect donations, according to the company’s analysis of on-chain activity.

The organization came into the limelight after U.S. troops pulled out of Afghanistan.

TRM Labs’ “2025 Crypto Crime Report,” which focused on a snapshot of 2024 and was released on February 10th, also showed that illegal cryptocurrency transactions decreased by 24% in 2024 compared to the previous year.

But the report also highlighted the evolving tactics being used by terrorist organizations.

Specifically, TRM Labs’ investigation linked ISKP-affiliated addresses on-chain to covert fundraising campaigns in India. The on-chain link is the component of the Chainlink network that operates directly on a blockchain, including smart contracts that handle data requests and are further linked with off-chain oracles.

The TRM report stated that ISKP has begun accepting donations in Monero (XMR) cryptocurrency. The organization’s official media outlet launched its first donation drive promoting Monero, as announced in the publication Voice of Khorasan, produced by ISKP’s media unit, al-Azaim. Calls for donations in Monero have since become a regular feature of their fundraising efforts.

The report further stated that ISKP and other terror groups are increasingly favoring Monero due to its privacy features within the blockchain. Monero is currently valued at ₹19,017.77. This strong privacy tool aids in obfuscating the transactions.

However, the report highlighted that terrorist organizations will not favor Monero cryptocurrency for long due to its volatility and the potential for crackdowns, and will instead opt for more stable cryptocurrencies.

Even crime reports released by Chain Analysis highlighted that cybercriminals are now targeting stablecoins more heavily, and stablecoin crime rose by 63% in 2024 compared to the previous year.

The findings also showed that terrorist organizations are adapting and changing to improve their ability to evade government and law enforcement agencies. As the government is increasing security against terror-linked financial networks, these groups have modified their tactics, techniques, and procedures (TTPs) to avoid detection.

Moreover, there has been an increased reliance on unknown wallets and cryptocurrency mixers. Online forums have become the main centers for sharing advice on best practices and identifying services that provide the highest levels of protection.

Individuals are fabricating fake proofs to circumvent Know Your Customer (KYC) regulations imposed by exchanges, making it challenging for law enforcement agencies to track the illegitimate transactions.

However, Monero has gained attention for its advanced privacy features, which make transactions less traceable compared to Bitcoin and other mainstream digital assets, making it a preferable choice for those involved in unlawful financial activities.