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OFAC targets Shelbit
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned cryptocurrency exchanges Shelbit and Aban Tether, along with other entities, as part of an effort to disrupt Iran’s “shadow financial network.”
“OFAC newly added to its sanctions list the cryptocurrency exchanges known as "Shellbit" and "Aban Tether"”
OFAC said the exchanges served as channels supplying cryptocurrency laundered for Iran’s Islamic Revolutionary Guard Corps (IRGC), and Treasury Secretary Scott Bessent said, "Whether it's dollars, rials, or cryptocurrency, the Treasury will track down and dismantle the illicit financial networks that prop up the Iranian regime to the very end."
Reuters reported that the designation followed a July 31 investigation identifying the Dubai-based exchange Shelbit as the hub of a $4 billion Iranian sanctions evasion scheme.
Reuters also said Shelbit moved crypto on behalf of Iran’s central bank and to addresses linked by the Israeli government to the IRGC, while the exchange’s website had been down for months before reactivating the day after the Reuters investigation was published.
Money flows and denials
The sanctions described specific alleged crypto flows, with Shafaq News saying IRGC-linked digital addresses sent more than $1 million in cryptocurrency to Shelbit, while more than $2 million flowed from Shelbit addresses to IRGC-linked wallets.
Shafaq News further alleged that addresses owned or controlled by Siavash Kayvanpour transferred more than $2 million to Nobitex, which Washington sanctioned on June 2.
Shelbit denied the allegations, and Reuters quoted the company saying, "Shelbit LLC categorically rejects any suggestion that the company knowingly participated in money laundering, terrorist financing, illegal gambling activity, sanctions evasion, or activity on behalf of any sanctioned, military, or governmental organization."
Reuters also reported that the U.S. Treasury sanctioned Siavash Kayvanpour for providing material support to the IRGC and Nobitex, and that Aban Tether was sanctioned for processing millions of dollars of transactions for sanctioned Iranian entities including Nobitex.
Regulators and next steps
The U.S. action came soon after Dubai’s Virtual Assets Regulatory Authority (VARA) issued a notice saying Shelbit was in violation of money-laundering and terrorism financing laws, with Reuters quoting VARA that, "The exposure identified by VARA extends beyond consumer protection to more egregious cross-border transactions with the propension to impact the integrity of the UAE financial system."
“The exposure identified by VARA extends beyond consumer protection”
Reuters said VARA did not respond to a request for comment, while the U.S. Treasury described the designations as part of a broader crackdown on sanctions evasion through cryptocurrency networks.
UPI framed the sanctions as retaliation for Iranian attacks on commercial vessels in the Strait of Hormuz, citing State Department officials, and said Treasury officials described Iran as using a network of corporate entities to obscure the origin of funds and launder money to benefit the IRGC.
CoinDesk added that the sanctions were the latest in a string of U.S. measures against Iran’s crypto finance network, noting that in June the Treasury blacklisted Nobitex and other Iranian crypto exchanges, and that last month it sanctioned four crypto wallets linked to Iran’s central bank.
