U.S. Expands Iran Sanctions to Crypto Networks Funding IRGC
The United States is widening its campaign against Iran’s sanctions-evasion infrastructure by targeting cryptocurrency exchanges and financial facilitators accused of moving funds for the Islamic Revolutionary Guard Corps and other state-linked entities.
Summary:
- The U.S. sanctioned crypto exchanges accused of facilitating Iranian state-linked transactions.
- Dubai-based Shelbit was linked to at least $4 billion in suspicious financial flows.
- Washington is extending Iran sanctions from banks and oil networks into crypto infrastructure.
- The State Department is offering up to $15 million for information on IRGC financing.
The latest action includes sanctions against Dubai-based Shelbit and Iran-based Aban Tether, adding digital asset platforms to a broader effort that already covers exchange houses, shell companies, shipping networks and procurement channels.
Shelbit became a focal point in Iran’s crypto sanctions network
Shelbit drew scrutiny after a Reuters investigation traced at least $4 billion through the Dubai-based exchange and connected its activity to Iranian financial networks, including the Central Bank of Iran, online gambling operations and addresses associated by Israeli authorities with the IRGC.
The exchange was founded by Iranian expatriate Siavash Kayvanpour and operated without a Dubai virtual asset license. U.S. authorities later sanctioned both Shelbit and Kayvanpour, alleging that the network provided material support to the IRGC and to Nobitex, Iran’s largest crypto exchange. Nobitex itself had already been sanctioned by the Treasury in June.
Reuters reported that Shelbit-linked wallets sent at least $676 million to Binance, while at least $125 million in activity was tied to Iran’s central bank. Binance said Shelbit itself did not maintain an account on the platform and that accounts linked to the activity were reviewed, frozen and reported where appropriate.
Those numbers help explain why Washington is treating crypto infrastructure as part of Iran’s broader shadow banking system rather than as a separate technology problem.
| Network element | Reported role | Key figure |
|---|---|---|
| Shelbit | Dubai-based crypto exchange linked to Iranian sanctions-evasion flows | At least $4 billion processed |
| Central Bank of Iran links | Transactions traced to state-linked financial activity | At least $125 million |
| Transfers to Binance-linked accounts | Crypto moved from Shelbit-associated wallets | At least $676 million |
| Rewards for Justice | Information disrupting IRGC financial mechanisms | Up to $15 million |
Why crypto matters to Iran’s shadow banking system
Sanctions do not prevent Iran from earning revenue. They make converting, moving and spending that revenue more difficult.
Traditional evasion networks typically rely on exchange houses, shell companies, commodity trades and correspondent banking relationships in jurisdictions willing or able to obscure the ultimate beneficiary. Crypto adds another settlement rail.
A sanctioned entity can convert local or offshore funds into stablecoins, Bitcoin or other digital assets, move them across borders without a conventional bank transfer and later convert them back into fiat through another exchange or OTC desk.
That process does not make the transaction invisible. Public blockchains often make flows easier to trace than cash. The challenge for enforcement lies in identifying the real owners of wallets and reaching the intermediaries where digital assets eventually meet regulated financial infrastructure.
The Shelbit case illustrates that tension. Blockchain tracing helped investigators reconstruct large portions of the network, yet billions of dollars were allegedly able to move before regulators intervened.
U.S. policy now treats Iranian crypto exchanges as financial institutions
The latest action builds on a more aggressive regulatory position established earlier this year.
OFAC states that Iranian digital asset exchanges qualify as Iranian financial institutions under U.S. sanctions rules. Property involving those exchanges that comes within U.S. jurisdiction must therefore be blocked, even when a platform is not individually listed on the Specially Designated Nationals list.
In June, Treasury went further by specifically designating Nobitex, Wallex, Bitpin and Ramzinex. Treasury said Nobitex alone processed more than 50% of all Iranian digital asset inflows in 2025 and had facilitated transactions linked to the IRGC and sanctioned ransomware actors.
Foreign companies are also exposed. OFAC warns that non-U.S. financial institutions and businesses can face sanctions risk for significant dealings with designated Iranian exchanges.
That expands the practical reach of the crackdown far beyond U.S. platforms.
The strategy extends well beyond cryptocurrency
Crypto is only one part of Washington’s pressure campaign.
Treasury has separately targeted Iranian exchange houses that move billions in foreign currency through layered shell companies, as well as procurement networks supporting IRGC weapons programs. In July, OFAC sanctioned exchange houses and financial facilitators accused of moving money for regime elites and the IRGC.
The operational model is similar across both traditional and digital channels:
- Funds enter through commodity sales, mining, gambling or offshore commercial activity.
- Exchange houses or crypto platforms obscure the original source.
- Shell companies and intermediaries move value across jurisdictions.
- Funds are converted into currencies or assets usable by sanctioned entities.
- Final beneficiaries gain access to international markets without relying directly on Iranian banks.
- Crypto does not replace shadow banking. It gives the same system an additional route.
Rewards for Justice adds an intelligence incentive
The State Department is attacking the network from another direction.
Its Rewards for Justice program is offering up to $15 million for information that leads to disruption of the IRGC’s financial mechanisms, including front companies, illicit oil-related schemes, formal financial institutions and entities helping the group evade sanctions.
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The program matters because blockchain analytics alone cannot identify every beneficial owner.
Investigators can often follow transactions from wallet to wallet, but understanding who controls a front company, who arranged an OTC conversion or which official authorized a transaction may require human intelligence, internal records or whistleblower evidence.
Combining financial sanctions with monetary rewards gives authorities a way to attack both the visible blockchain layer and the hidden organizational structure behind it.
Shelbit’s role remains contested
The allegations against Shelbit are substantial, but some distinctions remain important.
Shelbit has denied knowingly participating in money laundering, terrorist financing, sanctions evasion or activity on behalf of sanctioned Iranian entities. It has also said that it stopped operating in January 2026. Reuters reported, however, that transactions continued and that the exchange’s website returned shortly after its investigation was published.
Reuters also said it could not independently establish that the IRGC directly controlled Shelbit or the broader gambling network associated with it.
That distinction matters for credibility. U.S. sanctions are an administrative enforcement action based on Treasury’s findings and authorities, not the equivalent of a criminal conviction.
What changes next for exchanges and compliance teams
The immediate effect is a higher compliance burden for global crypto exchanges, stablecoin issuers and OTC desks.
Platforms now have to monitor not only individually sanctioned addresses but also counterparties linked to Iranian exchanges, shell companies and cross-chain flows that may trace back to designated entities.
The larger issue is secondary sanctions risk. A non-U.S. exchange that knowingly facilitates significant transactions for a sanctioned Iranian platform may itself become a target, even if it has no direct U.S. customer relationship.
The next development to watch is whether OFAC identifies additional overseas exchanges, OTC brokers or wallet clusters linked to Shelbit, Nobitex and Aban Tether. Further designations would show how aggressively Washington intends to extend its sanctions architecture from named Iranian platforms into the broader international crypto liquidity network.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Alexander Zdravkov
Reporter at CoinsPress
Alexander Zdravkov is a market analyst and crypto journalist with interests in economics, broader financial markets and digital assets. His journey into crypto began more than four years ago, driven by a fascination with the rapid evolution of blockchain technology and the transformative potential of decentralized finance. He began analyzing market cycles and identifying emerging trends before they reach the mainstream. He holds a degree in International Relations - a background that helped shape his broader perspective on global economics, geopolitics, and the interconnected nature of modern financial markets. Whether covering the latest developments in the crypto sector or exploring broader macroeconomic themes, Alexander focuses on giving readers context rather than simply repeating headlines. During his career, he has authored more than 10,000 articles covering cryptocurrencies, traditional finance, and global market developments. His work spans everything from Bitcoin and altcoins to macroeconomic trends influencing risk assets worldwide.
