OFAC targets crypto platforms tied to Iran-linked exchanges

The United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) has designated two cryptocurrency exchanges registered in the United Kingdom for operating in Iran’s financial sector. According to the agency, both exchanges have been aiding the country by processing its crypto transactions.

The detailed report from the OFAC revealed that the exchanges, Zedcex Exchange Ltd. and Zedxion Exchange Ltd., have also been providing several financial services to the Islamic Revolutionary Guard Corps (IRGC). The action marks the first time that OFAC has specifically designated crypto exchanges for operating in the financial sector of Iran. According to the agency, the platforms have carried out significant volumes of transactions for the IRGC.

OFAC designates exchanges linked to Iran’s financial operations

In the report shared by Chainalysis, Zedcex Exchange was registered in August 2022, and the exchange has reportedly processed more than $94 billion in transactions since it was established. On the other hand, Zedxion Exchange, which was registered in May 2021, initially had Iranian businessman Babak Morteza Zanjani listed as one of its directors. Both exchanges appear to be part of a network helping the country evade sanctions.

In addition, the network has also been fingered as the main avenue where funds are laundered for Iranian state interests, especially the IRGC. The connection between the exchanges and Babak Morteza Zanjani also provides another interesting angle to the OFAC action. In 2013, he was designated by the OFAC for acting as a financial facilitator for the IRGC, but was delisted under Joint Comprehensive Plan of Action (JCPOA)-related designation removals in 2016.

In 2016, Zanjani was sentenced to death in Iran for embezzling billions of dollars from Iran’s National Oil Company. However, his sentence was reduced in 2024, and by the following year, he was back as a financial backer of one of Iran’s largest railway investments. OFAC describes him as an “Iranian businessman and sanctions evader.” They claimed he was active in multiple sectors, including hospitality, transportation, technology, financial services, and oil exports.

OFAC also claimed that his connection to the designated crypto exchanges establishes a pattern of a network of operations attempting to use digital assets to evade sanctions. Speaking about the update, Secretary of the Treasury Scott Bessent noted the Iranian regime’s use of digital assets to evade sanctions. “Like rats on a sinking ship, the regime is frantically wiring funds stolen from Iranian families to banks and financial institutions around the world,” he added.

Who and what were designated by OFAC?

In its designation of Zedcex Exchange, OFAC included seven Tron addresses, which interestingly overlapped with wallets identified by Israel’s NBCTF in September 2025 as controlled by the IRGC. The OFAC action is a move against a growing pattern of Iranian state actors and their affiliates using digital assets to evade sanctions and carry out illicit activities. In the past few years, OFAC has designated several individuals linked with the country involved in crypto-related sanctions evasion.

The designation of the exchanges is part of a broader action targeting Iranian officials responsible for human rights abuses. OFAC also designated six Iranian officials associated with the IRGC and Law Enforcement Forces (LEF) for their roles in the violent suppression of protesters. These individuals include Minister of Interior Eskandar Momeni Kalagari, who is in charge of the LEF and multiple IRGC commanders responsible for provinces where security officials killed protesters, including children.

The action from OFAC introduces new compliance considerations for crypto businesses globally. The designation of exchanges registered in the UK with ties to Iran shows the importance of proper know-your-customer (KYC) procedures, improved transaction monitoring, especially when dealing with exchanges with exposure to illicit wallets.

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