US Treasury Targets Iranian Crypto Networks in $100M Sanctions Crackdown

The US Treasury Department has launched a campaign to cut Iran off from global financial networks, targeting cryptocurrency transactions in the process. Operation Economic Outcast was announced on August 24 as part of this effort, aimed at disrupting the financial networks that support the Iranian regime and the Islamic Revolutionary Guard Corps (IRGC).

Under the new sectoral determination, OFAC can now designate foreign persons involved in providing services to Iran's digital-asset economy. This includes exchanges, custodians, payment processors, and any other affiliate companies. The Treasury stated that Iran has been increasingly using cryptocurrencies to defy conventional financial sanctions.

The move may result in further vulnerabilities for crypto exchanges, custodians, payment processors, and any other affiliate companies. Companies could apply more rigorous wallet screening and transaction monitoring to vouch for sanctioned people or entities. U.S. sanctions may also apply to foreign companies for their knowledge of Iranian parties engaged in transactions that would otherwise be eligible to be undertaken by them.

The campaign follows a series of incidents aimed at Iranian exchanges, digital-asset wallets accused of transacting on behalf of sanctioned persons, and intermediaries. The Treasury's recent step further heaps pressure on the crypto industry as it officially starts applying its new sanctions on Iran across digital assets and other sectors, including technology and aviation.