The US has banned UK crypto exchanges for the first time in history
The US Treasury has taken the unprecedented step of blacklisting two UK-registered cryptocurrency exchanges for processing funds linked to Iran's Islamic Revolutionary Guard Corps (IRGC).
It is the first time that all digital asset platforms have been sanctioned by Iran-specific financial measures.
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Historic First: Entire Crypto Exchanges Sanctioned Over Iran's IRGC Ties
In the year On January 30, 2026, the Office of Foreign Assets Control (OFAC) named ZSEX Exchange Ltd. and ZXion Exchange Ltd., for facilitating approximately $1 billion in IRGC-related transactions, primarily for their role in the Tether (USDT) Tron network.
Since its listing in August 2022, ZSEX alone has handled more than $94 billion in total transactions, highlighting the exchange's operating volume.
The exchange is said to be linked to Babak Morteza Zanjani, an Iranian who was previously accused of defrauding the National Oil Company of Iran worth billions.
Treasury officials said that after Zanjani's death sentence was commuted to 2024, he continued to funnel money to the Iranian regime to fund money laundering and IRGC-related projects.
The Treasury will continue to target Iranian networks and corrupt individuals who enrich themselves at the expense of the Iranian people, Treasury Secretary Scott Besant said. “This includes the regime's attempts to exploit digital assets to evade sanctions and finance cybercriminals.”
The sanctions are part of a broader crackdown on Iranian officials and networks accused of violently suppressing the opposition. Top targets include Interior Minister Eskandar Momeni Kalagari and several IRGC commanders.
Independent estimates put as many as 30,000 protesters dead in the recent crackdown. Authorities are said to be using mass burials and secret medical networks to cover up deaths.
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Crypto Used to Bypass Sanctions: US Targets Exchanges and Government-Backed Networks
The US Treasury's move highlights the growing use of crypto as a tool to circumvent sanctions and finance illegal activities.
Elliptic reports that Iran's central bank has acquired more than $507 million in USDT by 2025. They have used the stablecoin to stabilize foreign trade in violation of traditional banking restrictions.
Citing blockchain intelligence firm TRM Labs, the Washington Post noted that by 2023, more than half of the exchange's volume will be linked to entities linked to the IRGC. This shows how state-sponsored actors use digital assets.
In addition to freezing all assets held by sanctioned entities in the US, the measures prohibit Americans from doing business with Zsex, ZDxion, Zanjani and other designated individuals or entities.
The civil and criminal penalties are severe, reflecting the US commitment to prevent illegal financing in the digital asset space.
These sanctions represent a historic shift in enforcement strategy. Instead of targeting individual wallets or transactions, US authorities are now sanctioning entire crypto platforms to disrupt systemic financial networks used for evasion and terrorist financing.
In the year With more than 875 Iranian people, vessels and aircraft sanctioned to destabilize activities by 2025, OFAC's latest action highlights the increasingly sophisticated interplay between digital assets and global security policy.
As crypto continues to integrate with global finance, authorities are expanding their reach, emphasizing that exchanges operating outside traditional jurisdictions can no longer enjoy impunity when facilitating illegal flows to sanctioned states or entities.
