U.S. Sanctions Crypto Exchange Tied to Iran’s Hormuz Transit Payments

The United States has sanctioned an Iranian cryptocurrency exchange that Treasury says was used to move payments collected from ships transiting the Strait of Hormuz into Iran’s financial system.

The Treasury Department’s Office of Foreign Assets Control on Thursday designated BitBank, an Iranian digital asset exchange controlled by sanctioned financier Babak Zanjani, along with its software developer and three Zanjani associates.

The maritime connection is Hormuz Safe Marine Services Authority, the Iranian entity that has emerged as part of Tehran’s alternative system for managing commercial traffic through the Strait.

Treasury said Hormuz Safe has used BitBank since June to transfer payments it collected to the Iranian government. Separately, Treasury alleges that Zanjani used BitBank between June and July to move hundreds of millions of dollars worth of Bitcoin to the Islamic Revolutionary Guard Corps.

The designation adds another layer to Washington’s effort to disrupt the financial system Iran has built around shipping through Hormuz.

In July, OFAC sanctioned Hormuz Safe and the Persian Gulf Marine Insurance Company, accusing them of operating an IRGC-backed scheme requiring commercial vessels to purchase Iranian-approved maritime insurance to transit the waterway.

Hormuz Safe advertises insurance, traffic control, security and emergency response services and accepts Bitcoin and other digital assets. Treasury says the system allows Iran to collect revenue from ships while avoiding conventional financial channels exposed to U.S. sanctions.

The arrangement emerged as Iran sought to establish a new system governing commercial passage through Hormuz. In June, Iran published rules requiring vessels to obtain passage permits, follow designated routes and carry approved insurance. The insurance requirement quickly became one of the most contentious parts of Tehran’s attempt to exert greater control over traffic through the waterway.

Industry groups subsequently warned that Iran’s “toll by insurance” system effectively tied commercial access to the Strait to an Iranian-approved insurance mechanism.

The Persian Gulf Marine Insurance Company issues policies approved by the U.S.-sanctioned Persian Gulf Strait Authority, or PGSA, according to Treasury. Washington sanctioned the PGSA in May, accusing it of working with the IRGC and IRGC Navy to impose a permission-based transit system and collect fees from commercial vessels.

The latest action appears aimed at the next step in that payment chain: what happens after money is collected from vessels.

Treasury said BitBank formed part of a wider digital asset network built by Zanjani, who has a long history in Iran’s sanctions-evasion system. Zanjani was sentenced to death in Iran in 2016 following an embezzlement case involving the National Iranian Oil Company. His sentence was commuted in 2024, and he later resurfaced as a backer of government-linked infrastructure and transportation projects.

OFAC previously sanctioned other Zanjani-linked cryptocurrency businesses before targeting BitBank on Thursday.

Also designated were BitBank developer Pishtaz Simorgh Electronic Trade Company and three executives tied to Zanjani’s Dot One business group: Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein and Seyed Adel Heidari. Treasury alleges members of the network were involved in Iranian oil exports and digital asset transactions ultimately benefiting the IRGC.

The sanctions were imposed under Executive Order 13902 as part of the Trump administration’s Operation Economic Outcast, a broader campaign launched in August targeting Iran’s oil trade, financial intermediaries, transportation networks and other sources of revenue.

The administration has also continued targeting Iran’s shipping networks. In July, Treasury sanctioned more than 50 individuals, companies and vessels linked to an oil trading and shipping network that Washington accused of helping Iran evade sanctions.

For commercial shipping, the BitBank action provides more detail on the financial machinery behind Iran’s emerging Hormuz transit system.

Washington has previously focused sanctions on the entities establishing the routing, insurance and maritime-service structure around the Strait. The BitBank designation extends that effort into the cryptocurrency infrastructure Treasury says is being used to move the proceeds.

As a result of the action, property and interests in property belonging to the newly designated parties that fall under U.S. jurisdiction are blocked, while U.S. persons are generally prohibited from conducting transactions with them. Treasury also warned that foreign financial institutions and other parties dealing with designated entities can face sanctions exposure.

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