The US Treasury Department has for the first time sanctioned cryptocurrency exchanges for operating in Iran’s financial sector.
The Office of Foreign Assets Control (OFAC) announced sanctions against Zedcex and Zedxion, both registered in the United Kingdom, as part of a wider crackdown on Iranian authorities following their brutal suppression of an internal uprising that killed thousands of their own citizens.
According to the Treasury Department’s statement, the exchanges facilitated transactions for the Islamic Revolutionary Guard Corps (IRGC), which the United States and its allies in the European Union designate as a terrorist organization. Since their registration in 2022, just one of these has processed over $94 billion in transactions, the Treasury Department said.
The two platforms are also linked to Babak Morteza Zanjani, an Iranian businessman once convicted of embezzling billions from Iran’s national oil company. OFAC alleges that Zanjani used the exchanges to help move funds to the regime, including revenue to support IRGC-affiliated entities.
Earlier this month, the Central Bank of Iran (CBI) was found to have purchased over $500 million of Tether’s USDT stablecoin with the primary purpose of manipulating currency markets as the rial’s value fell.
This designation marks a shift. While OFAC has previously sanctioned individual crypto wallet addresses and technology providers linked to sanctions evasion or cybercrime, this is the first time it has blacklisted entire exchange entities under Iran-specific financial sanctions authorities.
As a result of the designation, all US-linked assets on the exchanges are now frozen and US individuals and entities are barred from engaging with them.
