U.S. DOJ Seeks $61M From Alleged Iran-Linked Crypto-Laundered Oil Sales

U.S. prosecutors are pursuing cryptocurrency funds they allege were generated through illicit activities and ultimately used to support Iran’s military and related operations.

On Monday, the U.S. Department of Justice (DOJ) filed a civil forfeiture complaint seeking $61 million in cryptocurrency proceeds allegedly connected to Iran’s illicit sales of crude oil and petroleum products.

According to the complaint, the funds were intended for the Iranian government and its military organizations, including the Islamic Revolutionary Guard Corps (IRGC), which is designated as a terrorist organization by the United States.

Deputy U.S. Attorney Sean S. Buckley said the action reflects the government’s efforts to cut off funds that Iran and groups associated with it allegedly use to threaten U.S. citizens and others.

Buckley also said Iran uses sanctioned crude oil sales on the black market to finance its military and support terrorism across the Middle East and elsewhere. He added that the revenue allegedly supports other activities, including efforts related to nuclear development and ballistic missiles capable of carrying nuclear warheads.

Crypto Allegedly Used to Circumvent Oil Restrictions

The forfeiture action comes as military tensions between Iran and the U.S. have intensified since February. The conflict has disrupted international oil supplies and contributed to a significant increase in energy prices.

Iran’s crude exports have reportedly fallen sharply amid a strict U.S. naval blockade and fighting in the region surrounding the Strait of Hormuz. Prosecutors say cryptocurrency has provided Iran with another way to circumvent restrictions and maintain international trade.

The DOJ said investigators uncovered a $1.5 billion underground financial network referred to internally as “Entity A.” The operation allegedly moved proceeds from illicit Iranian oil sales through an extensive network of unhosted cryptocurrency wallets.

Unhosted wallets hold digital assets without relying on centralized exchanges or other third-party custodians. Prosecutors said the structure allowed the network to move large amounts of money while making it more difficult for authorities to freeze the assets.

The network allegedly transferred substantial sums to an Iranian cryptocurrency exchange, as well as to wallets and businesses associated with the IRGC.

Chinese Firms Allegedly Facilitated Transfers

The DOJ identified two Chinese companies, Blessed Trust and Hexa Whale, as key facilitators that allegedly coordinated most of the multimillion-dollar transactions.

According to the government, both companies used Binance trading accounts to launder proceeds from Iran’s black-market oil trade before the money was ultimately routed back to the Iranian government and affiliated groups.

Blessed Trust reportedly presents itself as a digital-asset custody provider serving other financial institutions. Prosecutors allege that the company also provided fiat-to-crypto conversion services for transactions connected to Iran and at times used U.S.-based cryptocurrency issuers.

Hexa Whale allegedly provided comparable money-laundering services while presenting itself as a legitimate commodities brokerage.

The two companies reportedly served Chinese businesses involved in oil and petroleum-product trading among their customers.

Binance Says It Blocks Sanctioned Transactions

Binance denied allowing transactions involving sanctioned individuals and said it maintains a strict policy against sanctions violations and illicit financial activity.

“Binance has zero tolerance for sanctions violations or illicit activity,” a Binance spokesperson told CoinDesk by email.

The spokesperson said the exchange would continue cooperating with law enforcement and would investigate, restrict or freeze accounts when sanctions or illicit-finance risks are identified. Binance also said it removes users from the platform when necessary and reports relevant cases to authorities.

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