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Iranian Cryptocurrency Networks Continue Operation During Internet Blackout, Moving Billions
Cryptocurrency infrastructure linked to Iran’s Islamic Revolutionary Guard Corps (IRGC) remained operational during the nationwide internet blackout that followed the February 28 U.S.-Israeli strikes, according to a new intelligence report. The functioning networks allowed hundreds of millions of dollars in cryptocurrency to flow out of the country despite severe communications restrictions.
Omri Raiter, founder and CEO of cyber intelligence firm RAKIA, told Fox News Digital his team detected a significant surge in funds leaving Iranian-linked cryptocurrency accounts immediately following the attacks.
“We’ve seen a surge of funds since the first hours of the war,” Raiter explained. “It started with tens of millions in the first hours, and it grew to hundreds of millions and more. Money was just flowing out from Iranian crypto accounts.”
The internal report, based on blockchain intelligence data analyzed by RAKIA, reveals that wallets linked to the IRGC received more than $3 billion in cryptocurrency in 2025. This figure aligns with public estimates from blockchain analysis firm Chainalysis, which valued Iran’s overall cryptocurrency ecosystem at $7.78 billion in activity last year.
Researchers observed that the outflow of funds continued even after Iran imposed a sweeping internet shutdown across the country. While national connectivity dropped to approximately 1% of normal levels according to internet monitoring group NetBlocks, RAKIA detected more than 1,100 active cryptocurrency nodes operating inside Iran.
“When the internet is at one percent and you still see over a thousand active crypto nodes, you’re not looking at retail users,” said Tom Malca, RAKIA’s head of cyber and AI research. “Those nodes require dedicated bandwidth, stable power and deliberate exemption from the shutdown.”
The majority of these nodes were concentrated in the Tehran-Qom corridor, an area housing major government and IRGC institutions, with smaller clusters detected in cities including Isfahan, Mashhad, Tabriz, and Kermanshah.
The findings suggest Iran has developed sophisticated crypto-based financial infrastructure capable of operating even during severe sanctions and communications disruptions. According to Raiter, this represents a significant challenge to international sanctions regimes designed to restrict Iran’s financial capabilities.
“The IRGC has been financing proxy operations through the very same crypto corridors that sanctions were designed to shut down,” Raiter noted.
The U.S. Department of the Treasury took action against this trend on January 30, sanctioning cryptocurrency exchanges tied to Iranian actors. This marked one of the first instances where the U.S. targeted entire digital asset platforms rather than individual wallets for sanctions evasion linked to the IRGC.
Treasury Secretary Scott Bessent emphasized the government’s commitment to disrupting financial networks connected to Tehran. “The Treasury will continue to pursue Iranian networks and corrupt elites who enrich themselves at the expense of the people,” Bessent said in a Treasury press release. “This also applies to attempts by the regime to use digital assets to circumvent sanctions.”
RAKIA’s analysis indicates the recent surge represents two parallel trends: funds moving to support Iran’s regional proxy networks, and capital flight by individuals connected to the regime seeking to protect personal wealth.
“The proxy war funding and the personal capital flight are two sides of the same coin,” Raiter said. “They move through the same pipelines.”
Researchers identified cryptocurrency flows connected to networks previously associated with Iran-backed groups, particularly those linked to Lebanon and Yemen. The scale and timing of the transfers suggest coordinated action rather than isolated incidents.
“Some of it could be people inside the IRGC trying to move their own money,” Raiter added. “But when you see the scale and the timing, it looks coordinated.”
RAKIA’s investigation relied on a combination of network monitoring and publicly available blockchain intelligence. Fox News Digital reached out to the Iranian mission to the United Nations in New York for comment on the claims made in the report, but received no response.
The findings highlight the evolving nature of financial warfare in conflict zones, where digital assets can provide resilience against traditional economic sanctions and infrastructure disruptions. As cryptocurrency adoption grows globally, it presents both new opportunities for sanctioned entities and new challenges for those attempting to enforce international financial restrictions.
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9 Comments
This news highlights the dual-edged nature of cryptocurrencies – they can provide financial freedom, but also enable illicit activities beyond the reach of regulators. Striking the right balance will be crucial.
This report highlights the complexities involved in regulating a borderless, decentralized financial system like cryptocurrencies. Effective oversight will require international coordination and creative solutions.
The ability of Iran to transfer hundreds of millions in crypto during an internet blackout is quite remarkable, though concerning from a sanctions enforcement perspective. This speaks to the evolving landscape of digital finance.
This highlights the complexities of regulating cryptocurrencies, especially for sanctioned entities. Effective monitoring and enforcement will be critical to curb illicit crypto flows.
While cryptocurrency enables fast, anonymous transactions, it also presents challenges for authorities trying to track and control financial flows, as this report on Iran demonstrates.
This report underscores the growing importance of blockchain analytics and crypto forensics in tracking illicit financial flows. Policymakers will likely focus on enhancing these capabilities going forward.
Fascinating to see how Iran is leveraging crypto to move funds during internet blackouts. Curious to learn more about the scale and implications of this cross-border financial activity.
The resilience of Iran’s crypto networks during internet shutdowns underscores the technology’s potential to circumvent traditional financial controls. Policymakers will need to grapple with these emerging realities.
While cryptocurrencies offer many advantages, this incident with Iran demonstrates the potential for abuse. Balancing innovation and regulation in the crypto space will be an ongoing challenge for global leaders.