Iran Utilized UK Cryptocurrency Platforms to Bypass Sanctions with $1 Billion in Covert Transactions: Report

Two cryptocurrency exchanges registered in the United Kingdom handled around $1 billion in transactions associated with Iran’s Islamic Revolutionary Guard Corps while publicly functioning as standard trading platforms, as disclosed by blockchain intelligence firm TRM Labs in a report dated January 9.

Zedcex and Zedxion aided in operational financing for the IRGC, with illicit transactions making up about 56% of their overall transaction volume, peaking at 87% in 2024.

The exchanges, established in the UK between 2021 and 2022, utilized nominal directors, virtual office addresses, and consistently filed dormant accounts, all while processing billions in on-chain transactions.

Corporate documents directly link Zedcex to Babak Morteza Zanjani, an Iranian financier known for evading sanctions who was previously sanctioned by the US and EU in 2013 for laundering billions in oil revenue for regime entities, including the IRGC, before these penalties were lifted under the now-defunct Iran nuclear agreement.

Source: TRMLabs

Network Processed Record IRGC Flows Through Shell Structure

IRGC-related addresses at Zedcex processed $23.7 million in 2023, which accounted for 60% of total activity, before skyrocketing to $619.1 million in 2024 when the IRGC’s share soared to 87%.

Activity saw a decrease to $410.4 million in 2025 as non-IRGC transactions rose, bringing the corps’ share down to 48%.

The two exchanges operated as a unified entity despite their separate UK registrations, with both organizations sharing directors, addresses, and synchronized timing that indicated continuity rather than independence.

Zanjani’s exit from Zedxion in 2022 was promptly followed by Zedcex’s establishment under the same control structure and address, implying operational continuity instead of separation.

After being arrested in Iran and sentenced to death for embezzling millions from Iran’s National Oil Company, his sentence was commuted in 2024 after he repaid the funds, and he reappeared publicly in association with regime-linked economic initiatives through DotOne Holding Group, a conglomerate involved in cryptocurrency, foreign exchange, logistics, and telecommunications.

Source: TRMLabs

TRM analysis established a direct connection between Zedcex wallets and addresses classified by Israeli authorities as IRGC property under the Administrative Seizure Order ASO-43/25, issued in September 2025, many of which Tether subsequently blocklisted.

Transfers were predominantly conducted in USDT on the TRON blockchain, routing funds between designated IRGC addresses, offshore intermediaries, and domestic Iranian exchanges, including Nobitex, Wallex, and Aban Tether.

The exchanges also connected with Zedpay, a Turkey-based mobile payment processor that has ties with Turkish financial institutions, including Vepara, whose license was later suspended due to money laundering concerns, and Vakif Katilim, a state-owned Islamic bank previously examined for facilitating Iran-related financial activities.

This integration expanded capabilities beyond trading to facilitate fiat settlements and real-world payments for entities under sanctions constraints.

Direct Terrorist Financing Links Established On-Chain

On-chain tracing uncovered that over $10 million in USDT was transferred directly from wallets attributed to both Zedcex and the IRGC to addresses controlled by Sa’id Ahmad Muhammad al-Jamal, who is sanctioned by the US Treasury for providing material support to the IRGC and operating smuggling networks that generate revenue for Yemen’s Houthis.

The lack of intermediary routing established Zedcex’s infrastructure as an active funding conduit rather than a mere incidental touchpoint.

The case arises as sanctioned nation-states increasingly dominate cryptocurrency crime statistics, with Chainalysis reporting that illicit addresses received at least $154 billion in 2025, reflecting a 162% increase from $59 billion in 2024, largely driven by a 694% rise in activities involving sanctioned entities.

Stablecoins constituted 84% of all illicit transaction volume, aligning with broader ecosystem trends where these assets facilitate easy cross-border transfers with lower volatility.

Iran’s wider cryptocurrency operations have faced escalating pressure throughout 2025, with flows involving Iranian entities dropping to $3.7 billion between January and July, marking an 11% decline from 2024.

The Treasury Department imposed sanctions on two Iranian nationals in September for orchestrating over $100 million in cryptocurrency oil sales benefiting the IRGC, while Iran has considered accepting digital currencies for advanced weapon sales, including ballistic missiles and drones marketed through its Ministry of Defense Export Center.

Russia introduced its ruble-backed A7A5 token in February 2025, processing over $93.3 billion in transactions in less than a year as Moscow similarly utilized cryptocurrency infrastructure to bypass Western financial restrictions.

The post Iran Used UK Crypto Platforms to Evade Sanctions With $1B in Secret Flows: Report appeared first on Cryptonews.