Iran's Revolutionary Guard Corps Transfers About $1 Billion Through UK Crypto Exchange

Two UK-registered cryptocurrency exchanges, Zedcex and Zedxion, have been linked to approximately $1 billion in stablecoin transactions tied to Iran’s Islamic Revolutionary Guard Corps (IRGC) between 2023 and 2025. The transfers were primarily in USDT on the TRON blockchain, a network known for its low costs and high liquidity. These activities represent a significant shift in how sanctioned actors leverage digital assets to bypass traditional financial restrictions.

The exchanges, while publicly positioned as standard trading platforms, operated more as a single entity under a shared corporate structure. Both exchanges were registered in the UK and displayed characteristics such as virtual office addresses, dormant filings, and overlapping directors, suggesting a coordinated effort to obscure ownership.

Babak Morteza Zanjani, a long-time Iranian sanctions-evasion financier, played a central role in the network. He had previously been sanctioned for laundering oil revenue on behalf of the IRGC and later re-emerged in 2025 with ties to regime-linked economic projects. His involvement in Zedxion and Zedcex highlights the continuation of an established financial infrastructure that has adapted to new technologies.

How Did the IRGC Leverage Crypto Infrastructure?

The Zedcex network moved a large portion of its transaction volume through IRGC-linked wallets, with the share peaking at 87% in 2024. This infrastructure functioned as a clearing hub, routing funds between IRGC-controlled addresses, offshore intermediaries, and domestic Iranian crypto services. USDT on TRON was the primary asset used due to its widespread acceptance and low transaction costs.

These transfers were not random or incidental. TRM Labs' on-chain analysis found direct links between Zedcex and the IRGC, including dually attributed wallets and transfers to an OFAC-designated Houthi financier. The absence of intermediary routing suggests that Zedcex played an active role in operational funding, not merely as a touchpoint.

What Are the Broader Implications for Financial Regulation?

The Zedcex case illustrates the growing maturity of sanctions evasion through crypto infrastructure. Unlike traditional illicit finance, which often relies on volatile or opaque transactions, this network moved value persistently and at scale without triggering obvious red flags. The integration with fiat settlement systems, such as Zedpay in Turkey, increased the utility of these digital assets.

For regulators and policymakers, the challenge now shifts from identifying illicit flows after the fact to preventing the emergence of such infrastructure in the first place. This includes scrutinizing beneficial ownership, corporate structures, and the licensing of offshore platforms. The Zedcex example underscores the limits of traditional compliance models in a world where financial infrastructure can be quietly replicated across borders.

The case also raises questions about the role of third-party infrastructure providers, such as Singapore-based ChainUp, which supplied white-label services to Zedcex. These providers enable rapid deployment of crypto platforms, which can be exploited by sanctioned actors while maintaining operational separation for other activities.

What Comes Next for Enforcement and Risk Mitigation?

TRM Labs' analysis suggests that the next phase of sanctions enforcement in crypto will focus on identifying and disrupting the operation of illicit financial infrastructure before it becomes normalized. This requires a proactive approach that includes on-chain monitoring, corporate transparency, and enhanced due diligence by exchanges and regulators.

The Zedcex case also highlights the importance of cross-jurisdictional coordination. The integration of Zedcex with Turkish-based payment processors like Zedpay reflects a broader pattern where offshore crypto platforms interface with local financial intermediaries to bridge digital assets into the formal economy. This complicates enforcement by increasing the resilience of these networks.

The use of crypto in this context is not an anomaly. It represents a parallel financial system that enables sanctioned actors to sustain operations under ongoing pressure. For investors and market participants, the takeaway is that financial infrastructure itself is now a key risk. The control of platforms and the transparency of their ownership structures will be critical in preventing future abuse.

As Zedcex and similar cases emerge, regulators and financial institutions must adapt their frameworks to address infrastructure-level risks. The current model, which focuses on transactional compliance, may no longer be sufficient in a world where financial systems are increasingly decentralized and borderless.