U.S. expands Iran sanctions to make the country's entire digital asset sector sanctionable

The U.S. Treasury Department has broadened its Iran sanctions to encompass digital assets, giving the Office of Foreign Assets Control (OFAC) authority to target anyone operating in Iran's digital asset sector, regardless of where they are located. The designation took effect Aug. 24 and also extends to gold, shipping, aviation and technology. The change comes as Iran increasingly turns to Bitcoin and USDT to sidestep the traditional banking system. Blockchain analytics firm Elliptic said it traced at least $507 million in USDT acquired by Iran's central bank. Tether froze $344 million in USDT linked to the bank in April. Iran is also estimated to generate Bitcoin through domestic mining, leveraging low-cost energy to produce an asset that can be used to fund imports and help navigate sanctions. Elliptic estimates Iran represents roughly 4.5% of global Bitcoin mining, producing hundreds of millions of dollars in cryptoassets. The designation does not automatically sanction every Iranian crypto user, but it significantly expands Treasury's ability to pursue the sector and those supporting sanctioned entities.