- The U.S. Treasury sanctioned two Iranian financiers and several entities in Hong Kong and the United Arab Emirates for using cryptocurrency to help fund Iran’s oil sales.
- Officials allege the network moved $100 million in crypto assets to support Iranian oil trades.
- The sanctions follow reports linking $1.5 billion in USDT to Iran’s Revolutionary Guards, a group designated as a terrorist organization by the U.S.
- This marks only the second time such sanctions have been applied under a Trump-era executive order aimed at increasing pressure on Iran.
- The U.S. recently froze additional crypto assets tied to Iran’s drone program and previously seized $332 million in related transactions.
Alireza Derakhshan and Arash Estaki Alivand, two Iranian nationals, along with several firms and individuals in Hong Kong and the United Arab Emirates, were sanctioned this week by the U.S. Treasury. The Treasury alleges the group used cryptocurrency to move $100 million to help support Iran’s oil sales, bypassing international sanctions.
According to the Treasury, these activities involved a “shadow banking” network to transfer funds connected to oil sales. Officials said, “The oil sale will support regional terrorist proxy groups, and help Iran develop advanced weapons systems, including ballistic missiles and unmanned aerial vehicles (UAVs), which threaten the security of U.S. forces and those of our allies.”
The sanctions were announced one day after Israeli authorities identified $1.5 billion in USDT (a stablecoin pegged to the U.S. dollar) that they believe is connected to Iran’s Revolutionary Guards, a branch of Iran’s military forces that has been labeled a terrorist organization by the U.S. The U.S. Treasury cited the use of Hong Kong and UAE companies as a way for Iran to bypass existing international sanctions.
The measures use authority provided by the National Security Presidential Memorandum 2, a 2018 Trump administration executive order designed to apply “maximum pressure” on Iran. This is only the second time sanctions of this specific kind have been implemented.
Iran has faced multiple rounds of sanctions from the U.S. and other nations, leading to an increased use of cryptocurrency for international trade. Last month, the UK, France, and Germany joined in reimposing UN sanctions, calling for better inspection access at Iranian nuclear sites.
The crypto analytics firm Elliptic has previously linked the Iranian exchange Nobitex to the Revolutionary Guards as part of a cross-border system for evading sanctions. In June, pro-Israeli Hackers reportedly stole $90 million after breaching Nobitex.
Last Friday, the U.S. froze another $584,000 in USDT related to Iran’s drone program, according to the U.S. Department of Justice. These actions follow earlier moves to sanction crypto wallets receiving $332 million linked to Iran’s Revolutionary Guards.
Cryptocurrency is often used to conduct transactions that avoid traditional banking scrutiny, making it a frequent tool for countries and groups facing international sanctions.
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