Investigation into Cryptocurrency Exchanges
A newly released investigation highlights the involvement of two UK-based cryptocurrency exchanges, Zedcex and Zedxion, in facilitating substantial transfers of stablecoins on behalf of the Islamic Revolutionary Guard Corps (IRGC) of Iran. According to the 2026 Crypto Crime Report from TRM Labs, these companies, which claimed to operate like traditional cryptocurrency exchanges, were actually functioning in tandem to support Iran’s efforts in evading international sanctions.
Transaction Volumes and Trends
In 2023 alone, transactions linked to the IRGC accounted for 60% of Zedcex and Zedxion’s activity, amounting to $23.7 million. This involvement escalated dramatically in 2024, with the volume soaring by 2,500% to $619.1 million, embodying 87% of the total exchanges’ transactions. By 2025, this figure saw a decrease to $410.4 million.
Operational Status and Controversies
The documentation pertaining to Zedcex and Zedxion confirms their operational status, yet their financial disclosures raise questions regarding the validity of the claimed scale of operations on behalf of the IRGC. Notably, Babak Morteza served as director of Zedxion until August 2022; he shares a name with another individual, Babak Morteza Zanjani, who was sanctioned by the U.S. for managing large financial transactions for the Iranian government. Significantly, Zedcex formed shortly after Morteza’s resignation from Zedxion, both firms registered at the same address and reporting similar asset details.
Evidence of a Larger Network
Further evidence presented by TRM Labs asserts that these exchanges are integral to a larger network enabling Iran to sidestep sanctions. Records reveal that Zedxion was affiliated with Zedpay, a Turkish mobile payment service connected to several Turkish financial institutions that faced license revocations due to anti-money laundering breaches.
Expert Insights
Ari Redbord, TRM Labs’ Global Head of Policy, indicated that the case of Zedcex serves as a compelling demonstration of how cryptocurrencies can be leveraged as a covert financial system for illicit operations. He emphasized, “The critical concern is not merely about individual transactions, but rather about who governs these platforms and the overarching frameworks in place. This underscores the necessity for sanctions enforcement in the crypto space to address infrastructural and ownership issues directly.”
Moreover, other analytics firms are also closely monitoring Iran’s substantial use of cryptocurrencies for circumventing sanctions, especially noting the prevalence of USDT stablecoin in these operations. Tom Robinson, co-founder and chief scientist at Elliptic, remarked on the intelligence shared with clients to prevent exploitation stemming from these activities.
Broader Context and Implications
The broader context reveals Iran is currently facing significant unrest, with estimates of 650 protestor fatalities since the uprising started against the regime, and a dramatic decline in internet accessibility due to a nationwide blackout. Recent reports have flagged the Iranian Ministry of Defence’s acceptance of cryptocurrencies as payment for advanced weaponry, illustrating the role of crypto as an alternative transaction method in defiance of ongoing sanctions.
