A cryptocurrency exchange owned by an Iranian billionaire has been sanctioned by the US, which accuses it of processing toll payments from ships to pass through the Strait of Hormuz.
BitBank is alleged to have routed hundreds of millions of dollars to the Islamic Revolutionary Guard Corps (IRGC) after receiving cryptocurrency payments for the Hormuz Safe Marine Services Authority, which runs the so-called Tehran tollbooth.
The exchange is controlled by Babak Zanjani, 52, who was sentenced to death in 2016 for embezzling millions from the state-owned National Iranian Oil Company.
His sentence was commuted in 2024 and by 2025, he had publicly re-emerged as a backer of regime-linked projects to evade sanctions.
In July, further sanctions were imposed against nine other firms in which Mr Zanjani is involved, including his Iran-based Dot One conglomerate.
Announcing the latest measures, the US Department of the Treasury’s Office of Foreign Assets Control (Ofac) said Mr Zanjani started using BitBank to “facilitate the transfer of hundreds of millions of dollars’ worth of Bitcoin to the IRGC” in June.
Scott Bessent, US Secretary of the Treasury, said the latest “designations of Iranian digital-asset infrastructure make perfectly clear that efforts to finance the Iranian regime using cryptocurrencies are not beyond Ofac’s reach”.
“If you support the Iranian regime, the Department of the Treasury will sanction you,” he said.
The US also imposed sanctions on Pishtaz Simorgh Electronic Trade Company, the software developer behind BitBank, and Dit One executives Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein and Seyed Adel Heidari, who are close associates of Mr Zanjani.
The designations are part of the US's Operation Economic Outcast, intended to isolate Iran economically and disrupt its global financial, commercial and logistical networks, according to the statement.
The strategy has targeted Iran’s illicit oil trade, financial intermediaries and money exchanges, as well as shipping, aviation and front companies.
Iran first signalled in March that it intended to impose a fee on vessels seeking safe passage through the Strait of Hormuz, the vital waterway linking the Arabian Gulf and the Indian Ocean. It went on to establish schemes through two front companies to secure payments in cryptocurrency.
Mr Zanjani became notorious during the era of president Mahmoud Ahmadinejad (2005-2013) for finding ways to avoid sanctions and to channel hard currency from oil sales to Iran. He was arrested in 2013 during a crackdown on corruption in Iran and was accused of fraudulently pocketing $2.8 billion.
The US Treasury said Mr Zanjani's enterprises have served as both public-facing commercial ventures and covert financial platforms enabling sanctions evasion and support for Iranian state-linked entities.
Boosted by war
Mr Zanjani and UK-based crypto exchanges he controlled, Zedcex and Zedxion, were sanctioned by the US in January for their alleged role in funding the IRGC.
Since it was registered in August 2022, Zedcex has processed more than $94 billion in transactions, the Treasury said. Multiple Zedcex and Zedxion-attributed addresses have processed funds for cryptocurrency wallets linked to the IRGC.
Mr Zanjani's current visible business activities include an $800 million rail contract with the Iranian government awarded to Dot One.
He has also been involved in the aviation business and previously owned Qeshm Air. Last year, he launched Dot One Airlines; the US imposed sanctions on it.
Meanwhile, the UK has announced it is tightening sanctions on Iranian banks as part of the US-led economic pressure campaign aiming to force Tehran into signing a deal to end the conflict in the Middle East.
New licence applications made by the designated banks operating in the UK will be automatically rejected under a new approach imposed by Britain’s Treasury.
Chancellor of the Exchequer John Healey has also decided not to renew an existing general licence covering Iranian banks when it expires next month. These include Bank Sepah, Melli Bank plc, Bank Saderat, Persia International Bank and Bank Tejarat.
