US sanctions Iranian crypto exchange BitBank over IRGC Hormuz bitcoin transfers

<p dir="ltr"> The designation adds a fresh layer of scrutiny to crypto's role in Iran sanctions evasion, a theme likely to keep pressure on exchanges and wallets with any exposure to Iranian-linked flows, even indirectly. It also touches the Hormuz corridor story directly, since the sanctioned Hormuz Safe Marine Services Authority is described as having used BitBank to process payments tied to its bitcoin-settled transit scheme for vessels crossing the strait, a scheme Iran had reportedly targeted for over $10 billion in revenue. For oil and shipping markets, the practical effect is incremental rather than immediate, since sanctions on a single exchange are unlikely to materially disrupt Iran's broader sanctions evasion infrastructure, but they add another data point to the pattern of US economic pressure running in parallel with the military standoff in the Gulf. Bitcoin's own price reaction has been muted, consistent with the market's now well established view that Iran-related designations move geopolitical risk premia more than <a href="https://investinglive.com/education/seven-ways-to-value-bitcoin-from-network-adoption-to-stock-to-flow/" rel="follow">crypto valuations</a>.</p><p dir="ltr">---</p><p dir="ltr">Washington has sanctioned an Iranian crypto exchange it says funnelled hundreds of millions in bitcoin to the IRGC.</p><p dir="ltr">Summary:</p><ul dir="ltr"><li>OFAC designated BitBank, an Iranian digital asset exchange, on Thursday as part of an action <a href="https://home.treasury.gov/" rel="follow">Treasury </a>is calling Operation Economic Outcast</li><li>Treasury alleges BitBank was used to transfer hundreds of millions of dollars worth of bitcoin to the Islamic Revolutionary Guard Corps between June and July</li><li>Also designated were BitBank's software developer, Pishtaz Simorgh Electronic Trade Company, and three associates of Iranian financier Babak Zanjani, who Treasury says controls the exchange</li><li>Treasury said the OFAC-designated Hormuz Safe Marine Services Authority has used BitBank since June to transfer payments tied to a bitcoin-settled scheme covering vessel transits through the Strait of Hormuz</li><li>Zanjani was previously sanctioned by OFAC and was sentenced to death in Iran in 2016 over embezzlement linked to the National Iranian Oil Company</li><li>Treasury Secretary Scott Bessent said the designations show that financing the Iranian regime through cryptocurrency is "not beyond OFAC's reach"</li></ul><p dir="ltr">The US Treasury's Office of Foreign Assets Control sanctioned BitBank, an Iranian cryptocurrency exchange, on Thursday, alleging the platform was used to transfer hundreds of millions of dollars worth of bitcoin to the Islamic Revolutionary Guard Corps. The action, part of what Treasury is calling Operation Economic Outcast, also designated BitBank's software developer, Pishtaz Simorgh Electronic Trade Company, a subsidiary of the already-sanctioned Dot One Value Creation Group, along with three individuals Treasury linked to the network.</p><p dir="ltr">Treasury said BitBank is controlled by Babak Zanjani, an Iranian financier who has promoted the exchange on his social media accounts since at least 2024 and whose broader network has previously been targeted by OFAC. Between June and July this year, Treasury alleges, Zanjani used BitBank to move hundreds of millions of dollars in bitcoin to the IRGC, an organisation designated as a terrorist group by the US, the European Union and several other governments. Zanjani was sentenced to death in Iran in 2016 after being convicted of embezzling funds linked to the National Iranian Oil Company, a sentence that Treasury's account suggests has not curtailed his sanctions evasion activities.</p><p dir="ltr">The designation also touches directly on the Strait of Hormuz standoff. Treasury said the Hormuz Safe Marine Services Authority, itself already under OFAC sanction, has used BitBank since June to transfer payments it received to the Iranian regime. Hormuz Safe appears to be the formal entity behind a bitcoin-settled platform first reported by Iranian media in May, which was promoted at the time as offering a form of coverage for ships transiting the strait, with Iran reportedly targeting more than $10 billion in revenue from the scheme.</p><p dir="ltr">The three individuals named alongside BitBank and Pishtaz Simorgh, Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein and Seyed Adel Heidari, are described by Treasury as executives within Zanjani's wider network, with Hossein Ali Zaker Hossein separately accused of brokering digital asset transactions that reached the IRGC. Treasury Secretary Scott Bessent said in a statement accompanying the designations that "today's designations of Iranian digital asset infrastructure make perfectly clear that efforts to finance the Iranian regime using cryptocurrencies are not beyond OFAC's reach," adding that any party supporting the Iranian regime would face similar action.</p><p dir="ltr">The BitBank designation extends a series of US actions against Zanjani's network, following earlier sanctions in January and July that targeted other exchanges and associated companies. It also comes shortly after a separate US Justice Department case involving cryptocurrency allegedly connected to Iranian oil sales, underscoring the extent to which digital assets have become a recurring flashpoint in enforcement of the broader sanctions regime against Tehran.</p><p dir="ltr"></p> This article was written by Eamonn Sheridan at investinglive.com.