The U.S. 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 broader crackdown on Iranian authorities after their brutal suppression of an internal uprising that killed thousands of their own citizens.
According to the Treasury’s statement, the exchanges facilitated transactions for the Islamic Revolutionary Guard Corps (IRGC), which the U.S. and its allies in the European Union designate as a terrorist organization. Since their registration in 2022, just one of these processed over $94 billion in transactions, the Treasury 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 Zanjani used the exchanges to help move funds for the regime, including proceeds supporting IRGC-linked entities.
The Central Bank of Iran (CBI) was found earlier this month to have bought over $500 million of Tether’s USDT stablecoin, with the primary purpose of manipulating foreign exchange markets as the rial’s value plunged.
This designation marks a shift. While OFAC has previously sanctioned individual crypto wallet addresses and technology providers tied to sanctions evasion or cybercrime, yet this is the first time it has blacklisted entire exchange entities under Iran-specific financial sanctions authorities.
As a result of the designation, all U.S.-linked assets of the exchanges are now frozen, and American individuals and entities are barred from engaging with them.