OFAC Updates Iran Sanctions as $344M in Tether Frozen Amid Hormuz Tensions

The Office of Foreign Assets Control (OFAC) has updated its sanctions designation of the Central Bank of Iran (CBI), adding new cryptocurrency wallet addresses to its list of Specially Designated Nationals (SDN).

According to Chainalysis’ report, the CBI was originally sanctioned in 2019 for its role in channeling funds to the Islamic Revolutionary Guard Corps (IRGC) and affiliated groups such as Hezbollah. The latest update reflects growing scrutiny over Iran’s use of digital assets to move funds amid global restrictions.

Coordinated action: Tether and U.S. authorities

The sanctions update comes alongside a major enforcement action involving Tether, which worked with U.S. authorities to freeze approximately $344 million in Tether (USDT). Blockchain data confirmed that the frozen funds were linked to Iranian financial networks, including transactions routed through intermediary wallets associated with the Central Bank of Iran.

Multiple wallet addresses tied to the operation were frozen on April 23, with balances matching the reported seizure. The coordinated move highlights increasing collaboration between regulators and private crypto firms to disrupt illicit financial flows.

Tether CEO Paolo Ardoino addressed the action, stating:“USD₮ is not a safe haven for illicit activity. When credible links to sanctioned entities or criminal networks are identified, we act immediately and decisively. We combine blockchain transparency with real-time monitoring and direct coordination with law enforcement to stop funds before they can move.”

Strait of Hormuz: A new frontier for crypto tolls

The development comes amid escalating geopolitical tensions in the Strait of Hormuz, where Iran recently announced the collection of transit tolls from commercial vessels. Reports indicate that due to Iran’s lack of access to SWIFT, the IRGC has demanded payments in stablecoins to allow cargo transit. 

However, this transition has created opportunities for fraud. Some shipping companies were deceived into paying fake tolls to offshore scammers posing as Iranian authorities. In some cases, vessels that failed to meet the genuine crypto-payment demands were later harassed by IRGC naval forces.

Moreover, alongside the updated sanctions, OFAC also designated several entities, including Chinese “teapot” refineries such as Hengli Petrochemical and a network of 40 shipping firms allegedly connected to Iran’s shadow fleet.

These networks are believed to generate billions in revenue, with digital assets playing a key role in laundering funds back to the IRGC and affiliated organizations.

The role of stablecoins in geopolitics

As Iran finds itself increasingly isolated from the traditional global financial system, stablecoins, specifically USDT, have increasingly become the primary medium for state-linked illicit trade. Analysts suggest these digital assets generate billions in annual revenue for sanctioned entities, allowing the IRGC to bypass the primary financial gateways of the West.

This latest enforcement action underscores a permanent shift in global finance: blockchain transparency is no longer just a tool for tracking retail scams, but a central pillar of international sanctions and national security.

Also Read: EU Issues Total Crypto Ban on Russia in Massive 20th Sanctions Wave