The US Treasury Department has, for the first time, sanctioned cryptocurrency exchanges for their operations in the Iranian 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 statement, the exchanges facilitated transactions by the Islamic Revolutionary Guard Corps (IRGC), which the United States and its European Union allies designate as a terrorist organization. Since registering in 2022, just one of them has processed more than $94 billion in transactions, Treasury said.
Both platforms are also linked to Babak Morteza Zanjani, an Iranian businessman convicted of embezzling billions of dollars from Iran’s national oil company. OFAC claims Zanjani used the exchanges to help move funds for the regime, including profits intended to support entities linked to the IRGC.
It was discovered earlier this month that the Central Bank of Iran (CBI) purchased more than $500 million worth of USDT stablecoins from Tether, with the primary aim of manipulating foreign exchange markets as the value of the rial plunged.
This designation marks a change. Although OFAC has previously sanctioned individual crypto wallet addresses and technology providers related 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 this designation, all U.S.-related assets of the exchanges are now frozen and U.S. individuals and entities are prohibited from engaging with them.
