The US Treasury’s Unprecedented Move: Blacklisting UK-Registered Cryptocurrency Exchanges

In a groundbreaking development, the US Treasury has taken significant action by blacklisting not just individual accounts, but entire cryptocurrency exchanges registered in the UK. This drastic measure was enacted due to these platforms allegedly facilitating financial transactions linked to the Islamic Revolutionary Guard Corps (IRGC) in Iran. This decision sets a precedent, marking the first time entire digital asset platforms have faced sanctions under financial measures specifically targeted at Iran.

Historic First: Entire Crypto Exchanges Sanctioned Over Iran IRGC Ties

On January 30, 2026, the Office of Foreign Assets Control (OFAC) designated two cryptocurrency exchanges: Zedcex Exchange Ltd. and Zedxion Exchange Ltd. These exchanges were cited for their involvement in processing nearly $1 billion in transactions associated with the IRGC, mainly utilizing Tether (USDT) on the Tron network. Since its registration in August 2022, Zedcex has notably processed an eye-watering total of over $94 billion in transactions, underscoring the large scale of its operations and the potentially significant impact of this decision.

Moreover, these exchanges reportedly have ties to Babak Morteza Zanjani, an Iranian businessman who has previously been convicted for embezzling billions from Iran’s National Oil Company. Treasury officials allege that following the commutation of Zanjani’s death sentence in 2024, he resumed financial activities to launder funds for the Iranian regime. These illicit activities reportedly support IRGC-linked projects, raising numerous red flags in the eyes of international regulatory bodies.

“Treasury will continue to target Iranian networks and corrupt elites that enrich themselves at the expense of the Iranian people,” stated Treasury Secretary Scott Bessent. “This includes the regime’s attempts to exploit digital assets to evade sanctions and finance cybercriminal operations.”

These sanctions form a part of a larger initiative to crack down on Iranian officials and networks accused of brutally suppressing protests. Notably, among the individuals targeted are high-profile figures such as Interior Minister Eskandar Momeni Kalagari and several commanders affiliated with the IRGC. Some independent estimates contend that approximately 30,000 protesters have tragically lost their lives in the ongoing crackdowns. Authorities have adopted alarming tactics such as mass burials and covert medical arrangements to conceal fatalities.

Crypto Used to Bypass Sanctions: US Targets Entire Exchanges and State-Backed Networks

Furthermore, the US Treasury’s recent actions bring to light the increasing use of cryptocurrencies as instruments for bypassing sanctions and funding unauthorized operations. According to a report from Elliptic, in 2025, Iran’s Central Bank acquired over $507 million in USDT. The Iranian regime has strategically utilized stablecoins to stabilize the depreciating rial and sustain foreign trade, effectively circumventing traditional banking restrictions enforced by international authorities.

Further analysis from the Washington Post, based on blockchain intelligence from TRM Labs, has indicated that over half of the transaction volume generated by these exchanges in 2023 was directly linked to entities associated with the IRGC. This alarming trend underscores how state-backed actors are increasingly turning to digital assets to further their agendas.

In addition to freezing all assets held by the sanctioned parties within the United States, the new measures prohibit American citizens from engaging in any business dealings with Zedcex, Zedxion, Zanjani, and other identified individuals or entities. The penalties for any violations of these measures are rigorous, reflecting the US commitment to thwarting illicit financing within the rapidly evolving digital asset sector.

These sanctions signal a significant shift in enforcement strategy for US authorities. Instead of merely targeting individual wallets or specific transactions, the current approach encompasses the sanctioning of entire cryptocurrency platforms. Such actions aim to disrupt the broader financial networks that are systematically utilized for sanctions evasion and financing of terror-related activities.

With over 875 Iranian individuals, vessels, and aircraft already sanctioned in 2025 for various destabilizing activities, OFAC’s recent initiatives highlight the complex relationship between digital assets and global security policy. As cryptocurrencies become more integrated into international finance, authorities are broadening their scope, making it clear that exchanges operating outside conventional jurisdictions can no longer expect to remain immune when facilitating illicit flows for sanctioned entities.

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