US freezes $344M in crypto tied to Iran as Treasury targets IRGC flows

U.S. Treasury and Tether froze $344M in USDT tied to Iran’s IRGC, spotlighting how Tehran’s $7.8B crypto ecosystem leans on stablecoins to dodge sanctions and move oil money.

U.S. Treasury Secretary Scott Bessent has confirmed that the United States has sanctioned and frozen $344 million in cryptocurrency connected to Iran, targeting what he called “multiple wallets” that form part of the regime’s offshore funding channels. Bessent said Treasury would “track and combat all financial lifelines associated with the regime,” signaling that crypto flows are now firmly in Washington’s crosshairs alongside traditional banking networks.

The action follows a move by stablecoin issuer Tether, which announced it had frozen more than $344 million worth of USDT across two addresses after receiving information from U.S. authorities about possible links to illicit activity and sanctions evasion. KuCoin and other outlets reported that the two Tron wallets held about $213 million and $131 million in USDT respectively, and had been flagged by blockchain security firm PeckShield for connections to terrorism financing and criminal operations.

Chainalysis says the transaction behavior of the blacklisted addresses closely mirrors on‑chain patterns previously observed in Islamic Revolutionary Guard Corps networks, including the use of layers of intermediary wallets to route funds through addresses linked to the Central Bank of Iran. In a January report, the analytics firm estimated that Iran’s crypto ecosystem reached about $7.78 billion in 2025, and that IRGC‑associated addresses accounted for over 50% of total value received in the fourth quarter of that year.

According to Chainalysis, the IRGC’s crypto intake surged from more than $2 billion in 2024 to over $3 billion in 2025, with a significant share tied to sanctions‑busting trade, oil exports, and payments routed through offshore intermediaries. Earlier research by Elliptic also found that the Central Bank of Iran had acquired about $507 million in USDT to stabilize the rial and facilitate international trade settlement despite U.S. restrictions, illustrating how dollar‑pegged stablecoins have become embedded in Tehran’s workaround strategies.

The latest freeze underscores the double‑edged nature of stablecoins for U.S. policymakers. On one hand, real‑time blockchain analysis gives Treasury and its partners unprecedented visibility into Iranian financial activity and the ability to surgically blacklist high‑value wallets; on the other, the same tools that let ordinary users bypass capital controls can be weaponized by sanctioned actors at scale until they are caught.