U.S. Treasury Sanctions Crypto Exchanges for Iran Funding

The U.S. Treasury Department has sanctioned two cryptocurrency exchanges, Zedcex and Zedxion, for their involvement in Iran’s financial activities. Notably, this is the first time that crypto exchanges have faced sanctions specifically for operations in Iran. As such, it marks a significant increase in the enforcement of financial regulations for cryptocurrencies.

Sanction Removes Both Exchanges From the US Financial System

According to the Office of Foreign Assets Control (OFAC), the exchanges helped facilitate illegal financial transactions linked to the Islamic Revolutionary Guard Corps (IRGC), which the U.S. designates as a terrorist group. The exchanges are also connected to Babak Morteza Zanjani, an Iranian businessman convicted of stealing billions from oil revenues.

U.S. officials also argue that these exchanges played a role in helping Iranian groups evade international sanctions. They used digital assets to move money secretly across borders. Under the sanctions, all U.S. assets belonging to Zedcex and Zedxion are frozen. Likewise, American individuals and businesses are now banned from conducting any transactions with these exchanges.

This ban effectively cuts Zedcex and Zedxion off from the U.S. financial system, which could significantly affect their operations worldwide. Meanwhile, this action also supports the U.S. government’s broader efforts to strengthen regulations around cryptocurrencies. 

U.S. Treasury Sanctions North Korean IT Worker Network

In a similar vein, the US Treasury sanctioned two individuals and four entities linked to a North Korean IT worker last year. They were accused of infiltrating cryptocurrency companies to fund the country’s missile programs. The OFAC affirmed that the network aimed to steal personal data, impersonate Americans, and embed operatives within US crypto firms under false identities.

Song Kum Hyok, a North Korea-based operative, was sanctioned for allegedly using stolen identities of US citizens to assist North Korean IT workers in securing jobs at American companies. Russian national Gayk Asatryan was also sanctioned for employing dozens of North Korean IT workers under contracts with North Korean trading firms. As such, expanding the network’s reach through his companies.

The sanctions freeze all US-based assets connected to Song, Asatryan, and the four sanctioned Russian authorities. US individuals and businesses are also prohibited from engaging in any financial transaction with the individuals and entities.

Iran Makes Transfer via UK Exchanges

Recall that the IRGC in Iran was recently accused of using crypto exchanges registered in the United Kingdom to move funds. From 2023 to 2025, the IRGC transactions constituted the majority of the financial activities on Zedcex and Zedxion. 56% of the total flow was IRGC-linked and was carried out in Tether (USDT) stablecoin on the Tron network.

There are indications that Iran is not just performing ‘one-off’ crypto transactions. They are establishing a financial foundation to avoid sanctions from the United States and other Western nations.