US Treasury Targets Iran's Crypto Use to Evade Sanctions

The US Treasury's Office of Foreign Assets Control (OFAC) has officially classified Iran's digital asset sector as sanctionable, marking a significant escalation in efforts to curb sanctions evasion by Tehran through cryptocurrencies such as Bitcoin (BTC) and the stablecoin Tether (USDT).

According to blockchain analytics firm Chainalysis, Iran's crypto ecosystem was estimated to be worth over $7.8 billion last year. Notably, wallets associated with the Islamic Revolutionary Guard Corps (IRGC) accounted for more than half of the on-chain activity in the final quarter of the year.

In a report by Elliptic, it was revealed that Iran's central bank acquired at least $507 million in USDT, with transactions traced back to leaked documents from 2025. The majority of these stablecoin transactions were conducted through Nobitex, Iran's largest cryptocurrency exchange, before being transferred through a cross-chain bridge following a mid-2025 hack.

The US has intensified its sanctions efforts since April, freezing or sanctioning approximately $1 billion in crypto linked to Iran. Tether has also played a role, blocking $344 million in USDT in April and an additional $131 million in July after OFAC flagged wallets holding over $165 million in stablecoins.

In June, OFAC sanctioned several exchanges, including Nobitex, and named digital assets as a sanctionable sector of Iran's economy. This designation is based on Executive Order 13902, which allows for sector-wide sanctions rather than targeting individual entities.

Treasury Secretary Scott Bessent emphasized the goal of these measures, stating, "Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone." Iran has also utilized cryptocurrencies to charge tolls for ships passing through the strategic Strait of Hormuz, leveraging subsidized electricity to mine Bitcoin.

As blockchain analytics continue to improve, the ongoing conflict between Tehran's use of stablecoins and Washington's sanctions efforts is expected to persist.