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US targets Iran’s crypto sector, cites over $100M in oil-linked payments
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The United States has escalated its financial pressure campaign against Iran by expanding sanctions to encompass the country's entire digital asset sector. The Treasury Department announced on Monday that the Office of Foreign Assets Control (OFAC) has issued new determinations allowing it to target foreign individuals and companies operating in or supporting Iran's cryptocurrency ecosystem. This move broadens the scope beyond previous actions that targeted specific exchanges and wallets.
This latest action is part of a broader sanctions update that also covers the gold, aviation, and shipping sectors, alongside designating nearly 60 entities and vessels linked to Iran's nuclear, missile, cyber, and oil networks. The Treasury specifically highlighted the role of cryptocurrency as a "tool of choice for sanctions evasion," particularly for transactions connected to the Islamic Revolutionary Guard Corps (IRGC) and its Quds Force.
A central allegation involves Ukrainian broker Ivan Obukhov, based in the United Arab Emirates. The Treasury claims Obukhov and his company, Foscom FZE, processed over $100 million in cryptocurrency payments since 2023 to facilitate Iranian oil sales on behalf of the IRGC. Both Obukhov and Foscom FZE have been placed on the sanctions list.
The new sectoral determination represents a strategic shift. While previous enforcement focused on named platforms like Nobitex and Shelbit, this measure allows for sanctions against any person determined to operate in Iran's digital asset sector under Executive Order 13902. The Treasury states this "significantly expands" its ability to enforce restrictions.
Designated parties' US-linked assets must be frozen. Furthermore, foreign financial institutions that facilitate significant transactions for these entities could face restrictions on their access to the US banking system. This secondary sanctioning tool aims to deter global financial intermediaries from working with Iran's crypto networks.
The expansion follows a series of targeted strikes. In January, OFAC sanctioned UK-based exchanges Zedcex and Zedxion. On June 3, four Iranian exchanges were designated, including Nobitex. Just days ago, on August 7, exchanges Shelbit and Aban Tether were sanctioned for allegedly moving $5 million in digital assets linked to Iran.
The Treasury’s action signals an intensification of efforts to choke off revenue streams that circumvent traditional financial sanctions. By defining the digital asset sector broadly, the US aims to create a deterrent effect across the entire supply chain of services supporting Iranian crypto transactions.
Looking ahead, the move may force a compliance reckoning for crypto firms globally, particularly those operating in or near the Middle East. It underscores the growing recognition by governments of cryptocurrency's role in international finance and conflict, setting a precedent for sector-wide sanctions in the digital age.
