Financial institutions have reported $165 million in potential crypto transactions that may be tied to Hamas, according to the bureau of the U.S. Treasury department that combats terrorism financing.

The Financial Crimes Enforcement Network analyzed suspicious activity reports filed between January 2020 and October 2023, according to a letter signed by Deputy Treasury Secretary Adewale Adeyemo. The letter, reviewed by CoinDesk, was directed to the leaders of the Senate Banking and House Financial Services Committees and asked for their support in passing legislation that would broaden the Treasury Department’s oversight authority over crypto transactions.

The letter hedges the extent to which the $165 million figure might be tied to crypto or Hamas, with Adeyemo writing that a financial institution “may have attributed the full value of a customer’s transactions – including both fiat and digital assets activity – to Hamas, while only a portion of the reported activity may have constituted such activity.”

FinCEN found that more than 200 cryptocurrency addresses may have been used in these transactions. The Treasury Department is still conducting “ongoing analysis” on the potential threats posed by cryptocurrencies and crypto services, he wrote.

“We continue to assess that Hamas and other terrorists have a preference for the use of traditional financial products and services, but I remain concerned that as we cut off their access to traditional finance these groups will increasingly turn to virtual assets,” the letter said.

Adeyemo’s comments echo statements made by various Treasury officials over the past few months, who said they have seen limited use of crypto by terrorists.

The Wall Street Journal first reported on the letter earlier Wednesday.

Lawmakers have scrutinized the potential role crypto may have played in Hamas’ attack on Israel last October, which killed 1,200 and sparked a war in Gaza. The Palestinian death toll is now reportedly north of 30,000. A group of lawmakers, led by House Majority Whip Tom Emmer (R-Minn.) and House Financial Services Committee Chair Patrick McHenry (R-N.C.), wrote an open letter to the Treasury Department last November, saying Congress needed to know the actual extent to which Hamas was using crypto after a Wall Street Journal report alleged it was a tool used by the terror group.

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A few weeks later, the Treasury Department requested greater authority to pursue illicit activity in crypto, particularly overseas.

Adeyemo referenced that request as well, saying the analysis he discussed earlier “informed the set of high-level legislative proposals,” which “are intended to modernize” Treasury’s tools.

“These updates could clarify, and potentially expand, coverage of new entities in the virtual asset ecosystem that may be operating in areas of actual or perceived ambiguity with respect to their [Bank Secrecy Act] obligations,” he wrote. “A final proposal would explicitly provide Treasury’s Office of Foreign Assets Control the authority to deploy secondary sanctions, an impactful and flexible tool, against virtual asset firms doing business with sanctioned entities.”