U.S. Sanctions Iran-Linked Crypto Exchanges for Evading $94B in Sanctions

The U.S. Treasury sanctioned two UK-registered crypto exchanges linked to Iran, marking the first such action under its Iran sanctions program. The Office of Foreign Assets Control (OFAC) stated one exchange processed over $94 billion in transactions, allegedly aiding sanctioned Iranian entities. This signals crypto platforms must now comply with international sanctions regulations like traditional financial institutions.

U.S. authorities have sanctioned two crypto exchanges tied to Iran’s financial system. The action targets Zedcex Exchange Ltd. and Zedxion Exchange Ltd., both linked to Iranian businessman Babak Morteza Zanjani.

Zanjani was previously convicted of stealing billions from Iran’s national oil company. U.S. officials accuse him of laundering state funds to finance projects for the Islamic Revolutionary Guard Corps.

This is the first time OFAC has designated a crypto exchange connected to Iran’s economy. The Treasury stated the move aligns with sanctions enforcement typically applied to banks and payment processors.

According to the OFAC, Zedcex processed over $94 billion in transactions since its 2022 registration. A substantial portion was reportedly tied to IRGC-related activities.

Treasury Secretary Scott Bessent indicated the U.S. will penalize networks misusing digital assets. He added that crypto will not protect those seeking to evade international financial sanctions.

The action follows increased monitoring of digital asset use in Iran. Blockchain analytics recently reported Iran amassed over $500 million in Tether stablecoins.

OFAC claimed these transactions aimed to circumvent conventional banking channels. The sanctions also targeted Iranian security officials for human rights abuses during protests.