The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned two UK-registered cryptocurrency exchanges, Zedcex Exchange Ltd. and Zedxion Exchange Ltd., accusing them of facilitating large-scale financial activity that enabled Iran to evade international sanctions.
The move marks the first time OFAC has directly targeted digital asset exchanges for operating inside Iran’s financial ecosystem.
The action underscores a sharp escalation in U.S. enforcement policy, signaling that crypto infrastructure itself, rather than just wallets or individuals, can now be designated when linked to sanctioned jurisdictions.
First-of-Its-Kind Enforcement Against Crypto Exchanges
According to OFAC, both exchanges processed financial flows exceeding $1 billion connected to entities tied to the Islamic Revolutionary Guard Corps (IRGC). Despite being registered in the United Kingdom, the platforms allegedly operated in ways that provided material support to Iran’s sanctioned financial networks.
U.S. authorities linked both exchanges to Babak Morteza Zanjani, an Iranian financier previously convicted of embezzling billions in oil revenue and laundering funds on behalf of the Iranian regime. OFAC described Zanjani as a central figure in Iran’s efforts to bypass sanctions through alternative financial channels.
Immediate Asset Freezes and Transaction Bans
Under the sanctions, all property and interests of Zedcex and Zedxion within U.S. jurisdiction are immediately frozen. In addition, U.S. persons and entities are prohibited from engaging in any transactions with the exchanges, effectively cutting them off from the U.S. financial system and dollar-linked liquidity.
While the measures apply directly within U.S. jurisdiction, secondary effects may follow, as global counterparties often reduce exposure to sanctioned entities to avoid compliance risk.
Blockchain Evidence and USDT on TRON
Blockchain analytics firm Chainalysis reported that Zedcex alone processed more than $94 billion in transactionssince its registration in August 2022. Several high-volume addresses interacting with the exchange were directly linked to IRGC-associated networks.
OFAC noted that a significant share of the illicit flows relied on USDT, particularly on the TRON network, highlighting the continued use of stablecoins as a settlement layer in sanctions evasion schemes.
Part of a Broader Iran Sanctions Package
The designation of the two exchanges formed part of a wider sanctions package aimed at Iranian officials involved in human rights abuses and violent suppression of protests. OFAC also sanctioned seven Iranian individuals, including Interior Minister Eskandar Momeni Kalagari, who oversees Iran’s Law Enforcement Forces.
U.S. officials framed the action as both a financial and human rights measure, linking illicit crypto flows to state repression.
Treasury Warns Crypto Is Not a Safe Haven
Treasury Secretary Scott Bessent stated that the United States will continue to disrupt the Iranian regime’s use of virtual assets to finance illicit activity and bypass global restrictions. He emphasized that digital assets do not provide immunity from sanctions enforcement.
Market Takeaway
OFAC’s move against Zedcex and Zedxion represents a turning point for crypto sanctions enforcement. By directly designating exchanges, rather than only wallets or individuals, the U.S. has expanded the scope of accountability across the digital asset stack.
For the crypto industry, the message is clear: jurisdictional exposure, compliance controls, and counterparties now carry systemic sanctions risk, particularly where stablecoins and high-throughput networks intersect with geopolitics.
