How Iran’s Revolutionary Guard Built a Quiet Crypto Pipeline Through Britain’s Regulatory Blind Spots

A new investigation has cast fresh light on how digital assets are reshaping the mechanics of sanctions evasion. According to an analysis by blockchain intelligence firm TRM Labs, Iran’s Islamic Revolutionary Guard Corps has moved roughly $1 billion through two cryptocurrency exchanges registered in the United Kingdom since 2023. The findings, first reported by The Washington Post, suggest a shift from sporadic crypto use toward a more durable financial architecture designed to operate beyond the reach of traditional enforcement.

The exchanges at the center of the report, Zedcex and Zedxion, appear to function as a single operation under different brand identities. TRM Labs found that transactions linked to the IRGC accounted for approximately 56 percent of the platforms’ total trading volume between 2023 and 2025. Most of that activity relied on USDT, the dollar-pegged stablecoin issued by Tether, and was conducted on the Tron blockchain, a network often favored for its speed and low transaction costs.

The scale of activity grew rapidly. IRGC-linked flows rose from about $24 million in 2023 to $619 million in 2024, before reaching roughly $410 million in 2025. Analysts argue that this trajectory reflects more than opportunistic use. As one former US Treasury official involved in Iran sanctions policy told The Washington Post, the figures indicate that digital currencies are becoming “a financial channel for Iran’s shadow banking apparatus,” not merely a workaround of convenience.

The IRGC is subject to extensive US and Western sanctions tied to Iran’s nuclear ambitions and its financial support for groups such as Hamas, Hezbollah, and the Houthis, which Washington designates as terrorist organizations. Recent reporting by the Financial Times has also suggested that Iranian authorities are exploring crypto payments in arms sales, including ballistic missiles and naval equipment. Against that backdrop, the TRM Labs findings underscore how crypto infrastructure can be repurposed to bypass conventional chokepoints in the global financial system.

To map the exchanges’ activity, investigators made small test transactions to identify internal wallet structures and traced flows involving 187 wallet addresses previously designated by Israeli authorities as IRGC-controlled. Among the transactions uncovered was a $10 million transfer from an IRGC-linked wallet to addresses associated with a Yemeni national sanctioned by the US Treasury in 2021 for smuggling Iranian fuel to finance the Houthis.

The analysis also linked the exchanges to Babak Zanjani, an Iranian businessman notorious for helping Tehran evade oil sanctions during the Ahmadinejad era. Zanjani was convicted of embezzlement and initially sentenced to death in Iran, though his sentence was later commuted and he was recently released from prison, adding another layer of historical continuity to the sanctions-evasion network.

Both Zedcex and Zedxion claim on their websites to comply with anti-money-laundering standards. Zedcex lists Iran among prohibited jurisdictions, while Zedxion does not. Neither exchange responded to questions from The Washington Post, and officials from Iran’s UN mission and the UK’s Office of Financial Sanctions Implementation declined to comment.

Taken together, the report highlights a growing tension between national regulatory frameworks and the borderless reality of crypto markets. As enforcement agencies struggle to keep pace, the case raises uncomfortable questions about how sanctioned actors are exploiting jurisdictional gaps to construct parallel financial systems in plain sight.