Iran's 'Crypto Toll Booth' Is Just a Ledger of Who Tried to Get Sanctioned

Shipping firms thinking they can pay Iran's potential transit fees in cryptocurrency might want to reconsider, warns Kaitlin Martin, senior intelligence analyst at Chainalysis. Spoiler alert: if you're looking for a clever workaround to sanctions, you might want to put down the keyboard and back away from the whitepaper.

Under the current sanctions framework, any payments to the Iranian regime—including those tied to passage through key waterways—could be classified as "material support," putting companies at risk of violating US and international restrictions. Yes, that "convenient" crypto transaction you just made? It comes with a side of federal indictment.

"Doing so could carry significant sanctions violation risk, as the Iranian Revolutionary Guard Corps is sanctioned by multiple jurisdictions and Iran is subject to comprehensive sanctions by the United States," Martin told Cointelegraph. Translation: the US government has already drawn the lines on the whiteboard, and paying tribute to a sanctioned regime through a blockchain doesn't make you a DeFi pioneer—it makes you a potential test case for enforcement.

The warning follows reports that Iran may seek to collect transit fees in cryptocurrency. While there's been no official confirmation, US President Donald Trump has stated he would not accept any attempt by Tehran to impose tolls on shipping through the vital waterway. Apparently, "pay to play" only works when the play button isn't connected to an international incident.

Tehran has already expanded its use of digital assets, particularly stablecoins, to facilitate trade in oil, weapons, and commodities, based on publicly available data, Martin noted. Because when you're under sanctions, why not use the most transparent ledger system ever invented? Bold strategy, cotton.

However, she emphasized that cryptocurrency is not a foolproof workaround for sanctions. While it enables cross-border transfers outside the conventional financial system, blockchain transactions are inherently transparent and leave a permanent record. Turns out, being your own bank is great until the bank is also the FBI.

"In many ways, cryptocurrency is actually easier to trace than traditional methods of sanctions evasion," she said, pointing to investigators' ability to follow funds to cash-out points where assets can be frozen or seized. Nothing says "I definitely didn't commit sanctions violations" like a fully indexed, timestamped, publicly viewable transaction history. It's almost like blockchain was designed by accountants who hate criminals.

Other sanctioned states have explored similar approaches. Russia, for instance, has used digital tokens such as A7A5 to facilitate cross-border trade following sanctions imposed after its 2022 invasion of Ukraine. At this point, the Axis of Evil is starting to look like a16z portfolio.

Meanwhile, Iran's Bitcoin mining power has dropped significantly over the past quarter, losing around 7 exahashes per second and falling to roughly 2 EH/s, amid escalating tensions with the United States