Treasury Sanctions Iranian Crypto Exchange BitBank Over Bitcoin Transfers to IRGC
Bitcoin Magazine Treasury Sanctions Iranian Crypto Exchange BitBank Over Bitcoin Transfers to IRGC The U.S. is targeting Iran's use of crypto — specifically bitcoin. This post Treasury Sanctions Ira...
In a Thursday statement, the U.S. Department of the Treasury designated BitBank, an Iranian crypto exchange, as part of Operation Economic Outcast — the Trump Administration’s whole-of-government economic campaign against the Islamic Republic of Iran and its enablers.
The U.S. has sanctioned Iran for decades. This year, the Middle Eastern country has stepped up its use of cryptocurrencies — including bitcoin — in order to skirt around economic penalties.
“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,” Secretary of the Treasury Scott Bessent said in a statement.
“If you support the Iranian regime, the Department of the Treasury will sanction you.”
The sanctions target designated Iranian financier Babak Zanjani, along with its software developer, Pishtaz Simorgh Electronic Trade Company, and three of Zanjani’s associates: Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein, and Seyed Adel Heidari.
Since June, the Iranian Hormuz Safe Marine Services Authority has used BitBank to move bitcoin to the Iranian regime, according to the Treasury.
Thursday’s sanctions aim to hit the “architecture Zanjani built to launder funds,” it added.
“The Department of the Treasury will continue to not only target the Iranian digital asset ecosystem, but also international entities and actors which help facilitate it,” the statement continued.
Iran started a bitcoin-backed insurance service for its counties shipping companies earlier this year.
The U.S. in July said that it had frozen crypto linked to the Iranian regime, mostly in the form of Tether’s stablecoin.
Stablecoins like Tether’s USDT can be frozen by the company that issues the asset. But bitcoin, being decentralized and having no single issuer, cannot.
The U.S. Treasury’s Office of Foreign Assets Control in July said Iran had been dodging sanctions by accepting pay in bitcoin from ships passing through the Strait of Hormuz.
OFAC said at the time that Hormuz Safe, developed by Iran’s Ministry of Economy, “accepts payment in Bitcoin and other digital assets” so it can bypass sanctions.
Asanat Analysis — Why it matters
BitBank's sanction signals the U.S. Treasury's escalating focus on cryptocurrency as a sanctions evasion vector for state actors. Unlike prior enforcement against retail exchanges (e.g., Binance, Kraken settlements), this targets infrastructure explicitly facilitating IRGC fund flows—a financial arm of Iran's government. The designation likely triggers secondary sanctions on any entity transacting with BitBank, effectively cordoning it from global banking rails and creating operational friction for downstream Iran-linked wallets.
This reflects a strategic shift: regulators now track on-chain patterns and exchange custody flows with enough sophistication to attribute bitcoin transfers to specific sanction targets. It also signals that U.S. enforcement doesn't require proof of intentional violation—facilitating transactions that *happen* to benefit designated entities is sufficient. For exchanges globally, this raises compliance costs around geographic customer screening and transaction monitoring, particularly for emerging-market operations where user identity verification and fund-source attribution remain incomplete.