Tether Freezes $1 Billion in Iranian IRGC Funds

TRM Labs’ analysis reveals that, since 2023, the Iranian Islamic Revolutionary Guard Corps has transferred approximately $1 billion through UK-registered exchanges Zedcex and Zedxion, exploiting cryptocurrency to evade sanctions.

This discovery highlights significant vulnerabilities in cryptocurrency platforms against sanctions evasion, raising concerns about compliance and regulatory oversight in the global crypto trading ecosystem.

Tether Enacts Largest Freeze, Blocking 42 IRGC Addresses

TRM Labs identified that the IRGC utilized UK exchanges, Zedcex and Zedxion, to move about $1 billion, primarily in USDT on Tron. These operations began in 2023, with IRGC-related flow comprising 56% of trading volume.

Tether Ltd. executed its largest-ever freeze on July 2, 2025, blocklisting 42 IRGC-linked addresses. TRM Labs Analyst stated, “Tether froze 42 Iranian-linked addresses on 2 July 2025, many of which had flows to both Iranian exchanges and IRGC-affiliated addresses previously flagged by the Israeli National Bureau for Counter Terror Financing.” These transactions relied on Tron, highlighting a significant shift in compliance practices among stablecoin providers.

Israeli and U.S. authorities responded by linking the crypto activity to IRGC, illustrating heightened geopolitical attention and further aligning global counter-terror financing efforts. Tether’s decisive action underscores a trend towards increased regulatory intervention in crypto markets.

Regulatory Scrutiny Deepens Amid Sanctions-Evasion Concerns

Did you know? In 2025, Tether’s freeze marked its largest sanctions-related action, reflecting a pivotal shift towards proactive compliance in international crypto regulation.

According to CoinMarketCap, Tether USDt (USDT) maintains a price near its peg at $0.999 with a market cap at 186,712,276,063. Trading volume drops 52.19%, showcasing stable usage amid fluctuating engagement over a 90-day period, which records a slight 0.23% decrease.

The Coincu research team highlights that this event likely increases regulatory vigilance and enhances AML/KYC practices among exchanges. Historically, prolonged sanctions-evasion sparks stricter policies, stressing the need for robust compliance frameworks moving forward. Such enforcement shifts will influence broader crypto market stability.