Iran is reportedly leveraging cryptocurrencies, particularly stablecoins, to circumvent long-standing US sanctions and fund its military operations, according to recent reports from blockchain intelligence firms. A detailed investigation by TRM Labs, part of its 2026 Crypto Crime Report, reveals that two UK-registered crypto exchange companies, Zedcex and Zedxion, have been operating as a single entity to move billions of dollars in digital assets on behalf of Iran's Islamic Revolutionary Guard Corps (IRGC).
The report indicates that in 2023, $23.7 million in crypto was moved via wallet addresses linked to the IRGC through these exchanges, accounting for 60% of their total activity. This figure skyrocketed by 2,500% to $619.1 million in 2024, representing 87% of all transactions. The volume dipped to $410.4 million in 2025. One of the exchanges, Zedxion, listed Babak Morteza Zanjani—an individual sanctioned by the U.S. in 2013 for moving billions for the Iranian government—as its director until August 2022.
"This is not opportunistic crypto misuse—it's a sanctioned military organization operating exchange-branded infrastructure offshore," said Ari Redbord, Global Head of Policy at TRM Labs. He emphasized that the case highlights why sanctions enforcement must focus on the infrastructure, governance, and ownership of such platforms.
Beyond these exchanges, Iran's use of crypto as an economic lifeline is multifaceted. The country has been selling advanced weapons using cryptocurrency and operates significant crypto mining operations. However, recent nationwide internet bans, instituted to quell massive protests over inflation and economic woes, have severely disrupted these mining activities and limited citizens' access to crypto services.
The situation underscores the growing geopolitical role of digital assets. Cryptocurrencies offer a parallel financial system for nations under heavy sanctions, providing access to global markets despite being cut off from traditional banking infrastructure. Conversely, this poses a challenge to US monetary influence and is driving efforts to establish stricter legal frameworks for tracking and potentially blocking such transactions. This dynamic may further push activity towards decentralized finance (DeFi) and privacy-focused coins.
