Israel’s Ministry of Defense ordered the seizure of 187 cryptocurrency wallets, alleging they were used by Iran’s Islamic Revolutionary Guard Corps (IRGC).
The move highlights the increasing use of cryptocurrency in sanctioned states. It comes days after the US Justice Department seized $584,741 in USDT from an Iranian national tied to the IRGC’s drone program.
$1.5B in Crypto Wallets Seized by Israel
Israel’s National Bureau for Counter Terror Financing (NBCTF) and Defense Minister Israel Katz announced Monday the seizure order against 187 wallets, citing authority under the Anti-Terrorism Law of 2016. Officials said the wallets once processed $1.5 billion in Tether but now hold about $1.5 million.
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Katz wrote in the Administrative Seizure Order that the funds were either the property of the IRGC or “used for the perpetration of a severe terror crime.” The IRGC remains designated as a terrorist organization by Israel, the US, the European Union, Canada, and the United Kingdom.
Blockchain analytics firm Elliptic integrated the seized addresses into its monitoring system. This allows exchanges and institutions to screen transactions. Elliptic confirmed the wallets received the funds, but noted that not all may be directly controlled by the IRGC.
“Some of the addresses may be controlled by cryptocurrency services and could be part of wallet infrastructure used to facilitate transactions for many customers,” Elliptic noted.
Tether, issuer of the $110 billion-plus market cap stablecoin, blacklisted 39 of the wallets on September 13, blocking further transactions. The company has a history of cooperating with law enforcement by freezing funds tied to illicit finance, a practice enabled by USDT’s centralized control structure.
A Broader Crackdown on IRGC’s Expanding Crypto Use
The Israeli move is the latest in a series of international actions targeting the IRGC’s crypto networks. The IRGC has faced repeated allegations of using cryptocurrency to skirt sanctions. In June, pro-Israel hacking group Gonjeshke Darande drained $90 million from Iranian exchange Nobitex, accusing it of IRGC links.
In December 2024, the US Treasury sanctioned addresses tied to Sa’id Ahmad Muhammad al-Jamal. He had funneled $332 million in USDT to Yemen’s Houthi movement with IRGC assistance.
Last week, the US Attorney’s Office in Massachusetts filed a civil forfeiture action against Mohammad Abedini. They seized $584,741 in USDT connected to the IRGC’s drone program.
Analysts warn that the latest seizures underscore how cryptocurrencies—while transparent and traceable—can serve sanctioned states seeking liquidity.
“Rumors of IRGC using cryptocurrency to circumvent sanctions have persisted for years,” said Amir Rashidi, director at the Iran-focused nonprofit Miaan Group. “Some cases may involve exchanges not directly part of the IRGC but connected through complex financial networks.”
