U.S Sanctions Iran’s BitBank Over Bitcoin Payments Linked To Strait Of Hormuz Shipping Tolls

The United States sanctioned Iranian crypto exchange BitBank on Thursday, Sept. 17, accusing it of handling Bitcoin payments linked to ships using the Strait of Hormuz.

The US Treasury Department’s Office of Foreign Assets Control (OFAC) said BitBank had also helped move hundreds of millions of dollars in digital assets to Iran’s Islamic Revolutionary Guard Corps (IRGC).

It said the transfers were part of a network used by Iranian financier Babak Zanjani to move hundreds of millions of dollars in Bitcoin to the IRGC.

OFAC also sanctioned BitBank’s developer, Pishtaz Simorgh Electronic Trade Company, and three people it identified as associates of Zanjani.

They are Mohammad Mahdi Zaker Hossein, Hossein Ali Zaker Hossein, and Seyed Adel Heidari.

Treasury said BitBank is controlled by Zanjani. The United States had already sanctioned him over his alleged role in helping Iran avoid restrictions on oil and financial transactions.

Treasury described BitBank, Pishtaz Simorgh Electronic Trade Company and the three individuals as key parts of Iran’s digital-asset-based sanctions-evasion network.

The sanctions freeze any property or interests in property held by the designated parties that are within US jurisdiction. They also prevent US persons from doing business with them.

Foreign financial institutions and companies could also face sanctions if they knowingly carry out significant transactions involving the designated entities.

Treasury said BitBank had transferred hundreds of millions of dollars in digital assets to the IRGC.

It also said Hormuz Safe, an Iranian maritime-insurance and shipping-services platform previously sanctioned by the United States, used BitBank to process payments from vessels seeking to pass safely through the Strait of Hormuz.

Treasury has previously alleged that Hormuz Safe is part of an IRGC-backed scheme that requires vessels to buy maritime insurance to pass through the Strait.

The insurance also covers the risk of seizures by Iran itself.

The allegations connect the crypto payments to the financial arrangements surrounding commercial shipping in the Strait of Hormuz.

The waterway remains a major point of tension between the United States and Iran.

In August, the United States sanctioned Iranian crypto exchanges Shelbit and Aban Tether. It accused them of helping the Iranian regime avoid sanctions.

In June, Treasury sanctioned four Iranian crypto exchanges, including Nobitex, which it described as the country’s largest.

In July, the US government ordered the freezing of more than $130 million in USDt held in wallets linked to Iran.

Iran has also taken steps to deal with tighter financial restrictions.

Earlier this month, the Financial Times reported that Iran’s central bank had eased foreign-currency controls to encourage businesses to bring overseas earnings back into the country, including through cryptocurrency.

The BitBank sanctioned by the United States is separate from bitbank, inc., a fully licensed Japanese crypto exchange founded in 2014.

The Japanese exchange was acquired by SBI Holdings in June. Treasury said the Iranian BitBank was established in 2024.

References: jpost, tradingview