The United States has placed sanctions on BitBank, a Tehran-based cryptocurrency exchange that it says played a major role in Iran’s digital asset network. The action came from the U.S. Department of the Treasury through its Office of Foreign Assets Control, also known as OFAC.
The Treasury announced the move on September 17, 2026. The news received wider coverage on September 18. According to Treasury, BitBank moved hundreds of millions of dollars worth of Bitcoin to Iran’s Islamic Revolutionary Guard Corps, or IRGC. The agency also said the exchange handled payments tied to ships that paid for passage through the Strait of Hormuz.
The case shows how Bitcoin can form part of a wider financial network. It also shows why U.S. authorities continue to focus on crypto exchanges that have links to people or groups under sanctions.
What Is BitBank?
BitBank is a cryptocurrency exchange based in Tehran. Treasury said the platform was controlled by Iranian financier Babak Zanjani, who was already under U.S. sanctions.
According to Treasury, BitBank was part of what it calls Iran’s digital asset-based sanctions evasion system. The agency also placed sanctions on Pishtaz Simorgh Electronic Trade Company, the company that developed BitBank’s software.
Three people linked to Zanjani were also named in the action. They are Hossein Ali Zaker Hossein, Mohammad Mahdi Zaker Hossein and Seyed Adel Heidari.
The U.S. action means property linked to the designated entities that falls under U.S. jurisdiction is blocked. U.S. persons are also barred from transactions with the sanctioned parties.
The effect can extend beyond the United States. Foreign banks and crypto platforms that deal with a sanctioned entity can face the risk of losing access to the U.S. financial system under secondary sanctions rules.
Treasury Links BitBank to the IRGC
The main claim from the U.S. Treasury concerns Bitcoin transfers to the IRGC.
Treasury said BitBank was used between June and July to move hundreds of millions of dollars worth of Bitcoin to the organization. The agency described the exchange as a key part of a digital asset network that helped move funds linked to the Iranian regime.
This claim is central to the U.S. action. The Treasury has used sanctions against other Iranian crypto platforms this year as part of a wider effort to restrict financial channels that it says help Iran avoid international sanctions.
Treasury Secretary Scott Bessent said the latest action shows that crypto-based efforts to finance the Iranian regime remain within OFAC’s reach.
The Treasury’s statement is a government allegation and forms the basis of the sanctions. It is important to separate that allegation from an independent court finding.
Bitcoin Payments and the Strait of Hormuz
The second major part of the case involves the Strait of Hormuz.
The Strait is one of the world’s most important routes for global energy trade. In recent months, Iran has created a system known as the Hormuz Safe Marine Services Authority. The authority has been linked to payments from ships that seek what Iran describes as safe passage through the waterway.
Treasury said the authority charged tankers between $1 million and $2 million for passage during 2026. Since June, some of those payments passed through BitBank, according to the agency.
The Treasury had already placed sanctions on the Hormuz Safe Marine Services Authority in July. The latest action now puts the crypto exchange that allegedly handled part of those funds under U.S. sanctions as well.
This gives the case a wider financial dimension. The issue is not only about a crypto exchange. It also involves payments linked to one of the world’s most important shipping routes.
Why the Strait of Hormuz Matters
The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. A large share of global oil and gas trade normally passes through the area.
Recent tensions have reduced ship traffic through the waterway. Reuters reported on September 18 that only four commodity vessels passed through the Strait on Thursday. The 10-day average was 16 vessels per day.
That sharp decline has raised concerns about energy supply and transport costs.
Against this backdrop, the reported use of Bitcoin for ship passage fees adds another layer to the situation. Digital assets can allow money to move without the same path as traditional bank payments. That feature can attract legitimate businesses, but it can also draw attention from regulators when sanctioned entities are involved.
Who Is Babak Zanjani?
Babak Zanjani is an Iranian financier who has faced major legal and financial scrutiny.
OFAC designated Zanjani in January 2026. Treasury now says BitBank was under his control. The U.S. agency also links his wider business network to digital asset transactions and sanctions evasion.
Zanjani had received a death sentence in Iran in 2016 after a case tied to the National Iranian Oil Company. His sentence was later commuted in 2024. He later returned to public activity and backed projects linked to the Iranian regime, according to reports.
His connection to BitBank is therefore an important part of the U.S. case.
BitBank’s Software Developer Also Faces Sanctions
The Treasury did not target BitBank alone.
Pishtaz Simorgh Electronic Trade Company, the firm that built BitBank’s software, was also designated. Treasury said the company is a subsidiary of Dot One Value Creation Group, which was already under U.S. sanctions.
Three executives linked to Zanjani were also named.
This wider action shows that U.S. authorities are looking at the network around a crypto platform rather than only the exchange itself. Such a method can make it harder for a sanctioned operation to shift activity to another company within the same network.
No Crypto Wallet Addresses Were Listed
One detail stands out in the latest action.
OFAC did not publish cryptocurrency wallet addresses along with the new BitBank designation. This matters because blockchain compliance teams often use wallet addresses to identify and block transactions linked to sanctioned parties.
CoinDesk noted that OFAC has published wallet addresses in some earlier crypto-related sanctions cases. The BitBank action did not include such addresses.
That does not remove the sanctions from the exchange itself. However, it means crypto companies may need to rely more on entity names and other compliance information when they assess possible links to BitBank.
What the Sanctions Mean for Crypto Companies
The case is also important for exchanges outside Iran.
A crypto platform in another country that deals with BitBank could face U.S. sanctions exposure, even if the platform itself is not based in America. The same concern can apply to foreign financial institutions.
The U.S. government can use secondary sanctions to pressure foreign firms that deal with certain sanctioned entities. For crypto companies, this can create a strong reason to avoid transactions tied to BitBank.
The impact could therefore reach much farther than Tehran.
A Wider U.S. Campaign
The BitBank action forms part of a wider U.S. campaign called Operation Economic Outcast.
The campaign seeks to reduce Iran’s access to international financial and commercial channels. Crypto exchanges have become one part of that effort.
Earlier in 2026, the United States also targeted other Iranian digital asset platforms and people linked to them. The latest move shows that crypto remains an area of attention for U.S. sanctions authorities.
The Treasury’s message is clear: digital assets do not automatically protect a company or person from sanctions.
What This Means for Bitcoin
The BitBank case does not mean that Bitcoin itself has received U.S. sanctions.
The action targets a specific exchange, companies and individuals that Treasury says have links to Iran’s financial network. Bitcoin remains a global digital asset that trades on thousands of platforms.
Still, the case highlights a major feature of crypto markets. Blockchain transactions can be visible on public ledgers, while the identity behind an address may require additional information to identify.
For regulators, this creates both opportunities and challenges. They can study transaction records, but they also need reliable information about the people and businesses behind those transactions.
The Bigger Picture
The BitBank case brings together three major issues: U.S. sanctions, Iranian finance and cryptocurrency.
Treasury says BitBank moved hundreds of millions of dollars in Bitcoin to the IRGC between June and July. It also says the exchange handled part of the $1 million to $2 million fees that tankers paid for safe passage through the Strait of Hormuz.
The action also covers BitBank’s software developer and three people linked to Babak Zanjani. U.S. authorities have blocked property under U.S. jurisdiction and warned foreign institutions about the possible consequences of dealings with the designated parties.
For the crypto sector, the message is significant. Digital assets may operate across borders, but exchanges and financial networks can still face direct action from national regulators.
The BitBank case also arrives at a tense time for the Strait of Hormuz, where ship traffic remains far below its recent average. As geopolitical pressure rises, financial activity linked to the region is under closer scrutiny.
For now, the U.S. sanctions place BitBank at the center of a wider dispute over cryptocurrency, sanctions and international finance. The case will also test how crypto exchanges outside Iran respond when a platform becomes the target of U.S. sanctions.
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