The US Treasury sanctioned Iranian crypto exchange BitBank on 17 September, alleging it moved hundreds of millions of dollars in bitcoin to the Islamic Revolutionary Guard Corps.
The Office of Foreign Assets Control designated the platform under Executive Order 13902, describing it as a priority digital asset venture controlled by Babak Zanjani, an Iranian financier already on the sanctions list.
Treasury says Zanjani used BitBank between June and July 2026 to arrange the transfers, and that he has advertised the exchange on his own social media accounts since at least 2024.
The action also designated BitBank’s software developer, Pishtaz Simorgh Electronic Trade Company, and three associates of Zanjani: Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein and Seyed Adel Heidari.
The United States, European Union and several other governments designate the IRGC as a terrorist organisation.
The tanker connection
The most striking element of the designation is where the money was coming from.
Treasury says Hormuz Safe Marine Services Authority, which OFAC designated on 29 July, has used BitBank since June to pass payments it collected to the Iranian regime.
Hormuz Safe operated a maritime insurance scheme under Iran’s economy ministry. It charged commercial oil tankers between $1 million and $2 million in bitcoin or stablecoins per transit for what it called safe-passage insurance through the Strait of Hormuz.
Iranian media first reported the platform in May, when Iran said it was targeting more than $10 billion in revenue.
That places crypto in the middle of the shipping disruption that has been driving oil prices through 2026. Tankers paying to cross a waterway, settling in bitcoin, with the proceeds routed through an exchange and onward to the IRGC.
The State Department said the wider network gave the Iranian regime, including the Central Bank of Iran, a gateway to the international financial system.
Who Zanjani is
The central figure in this network has an unusual history even by the standards of sanctions cases.
Iran sentenced Zanjani to death in 2016 for embezzling millions of dollars from the National Iranian Oil Company. The sentence was commuted in 2024. Treasury says he returned publicly in 2025 as a backer of regime-linked economic projects.
He was designated by OFAC in January 2026 alongside two UK-registered exchanges, Zedcex Exchange and Zedxion Exchange, which Treasury alleged were laundering funds linked to the IRGC.
TRM Labs initially traced roughly $1 billion in IRGC-linked activity through those two platforms before expanding its investigation into the broader network.
In July, Treasury designated further companies and individuals connected to Zanjani, spanning financial services and digital asset trading across Iran and offshore jurisdictions.
BitBank is the fourth round of action against the same structure. All three newly designated individuals are executives within Dot One Value Creation Group, the network OFAC had previously designated, and Pishtaz Simorgh is a Dot One subsidiary.
BitBank’s own website lists Pishtaz Simorgh Tejarat and Avan Exchange under its exchange partners.
What the designation actually does
The practical effects are broader than the exchange itself, which is the point.
All property and interests in property belonging to the designated parties that sit in the United States or under the control of US persons are now blocked and must be reported to OFAC. US persons generally cannot transact with them without authorisation.
The 50% rule extends that automatically. Any entity owned half or more, directly or indirectly, by a blocked person is also blocked, even if it is not named on the list. In a network built on holding companies and subsidiaries, that reaches considerably further than the five names published.
The more significant exposure applies to firms outside the United States. Executive Order 13902 carries secondary sanctions risk, meaning a non-US exchange, custodian or payment processor found to be dealing with BitBank can face designation itself.
Treasury Secretary Scott Bessent was direct about the intent.
“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,” he said. “If you support the Iranian regime, the Department of the Treasury will sanction you.”
Treasury did not state a specific dollar amount for the BitBank transfers.
Part of a wider campaign
The designation is one strand of Operation Economic Outcast, the pressure campaign Bessent announced on 24 August and described at the time as an economic D-Day.
That campaign named five sectors of the Iranian economy as sanctionable: digital assets, technology, gold, aviation and shipping. The sectoral determination changed how exposure works, allowing OFAC to designate any person, anywhere, determined to be operating in Iran’s digital asset sector, rather than requiring a case built against each named firm first.
BitBank is what that authority looks like when it is used.
The pattern through 2026 has been consistent. Zedcex and Zedxion in January. Nobitex and three other Iranian exchanges in June. Shelbit and Aban Tether in August. Hormuz Safe in July. Now BitBank and its developer.
Each action targets infrastructure rather than individual wallets, which reflects a judgment that Iranian crypto activity is concentrated enough in specific platforms to be disrupted by removing them from the dollar system.
Whether that works is a separate question. Iranian exchanges accounted for roughly $9.9 billion in attributed crypto volume during 2025, and the sector has repeatedly reconstituted after enforcement. TRM noted that BitBank emerged as a new venture within a network that had already been designated twice.
For compliance teams, the immediate task is narrow. Screen for the newly listed entities, apply the 50% rule to anything they own, and review historical exposure. The harder problem is that a sectoral determination creates risk that cannot be checked against a published list, because the list is not where the exposure now begins.
FAQ
What did Treasury sanction?
BitBank, an Iranian crypto exchange, along with its software developer Pishtaz Simorgh Electronic Trade Company and three executives in the Dot One Value Creation Group network, designated on 17 September under Executive Order 13902.
What is the Hormuz connection?
Hormuz Safe Marine Services Authority, designated in July, charged oil tankers $1 million to $2 million in bitcoin or stablecoins per transit for safe passage through the Strait of Hormuz. Treasury says it has used BitBank since June to route those payments to the Iranian regime.
Does this affect non-US firms?
Yes. Executive Order 13902 carries secondary sanctions risk, so a non-US exchange or service provider dealing with BitBank can face designation itself. The 50% rule also automatically blocks any entity owned half or more by a designated party.
Disclaimer: This article is for informational purposes only and does not constitute financial or legal advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making any investment decisions.
