Catenaa, Tuesday, February 18, 2025 – Russia and Iran are increasingly using cryptocurrency to bypass Western financial sanctions, with sanctioned entities receiving $15.8 billion in crypto in 2024, according to a new report from blockchain analytics firm Chainalysis.
The report, shared with Cryptonews, found that sanctioned jurisdictions accounted for nearly 60% of crypto-related sanctions activity last year, marking a shift from individual entities to state-backed financial networks.
Moscow and Tehran have embraced decentralized finance (DeFi) and no-KYC exchanges to sustain operations amid tightened restrictions. Russia also legalized crypto mining and cross-border payments in 2024, while Iran saw a surge in crypto outflows as citizens turned to digital assets to hedge against soaring inflation and currency devaluation.
Western enforcement agencies have responded with major crackdowns. The US sanctioned Russian drone manufacturer KB Vostok for laundering millions through crypto, while Germany seized 47 Russian-language no-KYC exchanges facilitating ransomware and darknet transactions. The UK’s National Crime Agency dismantled a Russian-speaking money laundering network spanning 30 countries, seizing over €20 million in assets.
Iran, facing increasing global isolation, has seen exchange interactions decline by 23% since 2022, while small transactions under $1,000 fell by 33%. Authorities have tightened financial controls, halting crypto withdrawals in December amid a collapsing rial.
Despite enforcement efforts, rebranded illicit exchanges continue to emerge, signaling ongoing challenges in curbing crypto-facilitated sanctions evasion.
