On Tuesday, September 16, 2025, the United States Treasury Department announced sweeping new sanctions targeting a complex network of Iranian financiers and more than a dozen associated individuals and firms spread across Hong Kong and the United Arab Emirates. The move, detailed in statements from U.S. officials and widely reported by the Associated Press, marks a significant escalation in Washington’s efforts to choke off funds flowing to Iran’s government and military—especially those sourced from oil sales and laundered through cryptocurrency.
At the heart of the sanctions are two Iranian nationals: Alireza Derakhshan and Arash Estaki Alivand. According to the Treasury, these men orchestrated the purchase and transfer of over $100 million worth of cryptocurrency, proceeds from Iranian oil sales, on behalf of the Iranian government. The operation, as described by U.S. authorities, relied on a tangled web of front companies stretching across multiple countries. This so-called “shadow banking” structure allowed Iranian actors to skirt longstanding international sanctions by moving funds through overseas shell companies and the opaque world of digital currencies.
John K. Hurley, Treasury Under Secretary for Terrorism and Financial Intelligence, minced no words in a statement distributed to the press. “The U.S. will continue to disrupt these key financial streams that fund Iran’s weapons programs and malign activities in the Middle East and beyond,” Hurley declared, underscoring Washington’s determination to clamp down on what it sees as illicit Iranian activity.
The legal authority for these new sanctions comes from the National Security Presidential Memorandum 2—an executive order issued by former President Donald Trump in February 2025. This memorandum is explicit in its aims: to drive Iran’s oil exports to zero and to ensure that Iran “can never be allowed to acquire or develop nuclear weapons.” Under these newly invoked powers, the sanctioned individuals and companies are now denied access to any property or financial assets held within the United States. Furthermore, U.S. companies and citizens are strictly prohibited from conducting any business with them.
This latest move by the U.S. government is part of a broader, intensifying campaign to cut off Iran’s access to international finance, particularly as the country and other sanctioned states have become increasingly adept at exploiting new technologies. According to data provided by the crypto-tracking firm Chainalysis, sanctioned jurisdictions and entities—like Iran—received a staggering $15.8 billion in cryptocurrency during 2024 alone. That figure represents about 39% of all illicit crypto transactions worldwide, highlighting just how central digital currencies have become to sanctions evasion schemes.
“Shadow banking” and the use of cryptocurrency have become buzzwords in the world of global finance, but for U.S. officials, these are not just abstract concepts—they are real and growing threats to the effectiveness of international sanctions regimes. The Treasury’s recent actions are meant to send a clear signal: the U.S. is watching, and it is willing to act decisively to disrupt these sophisticated financial networks.
The timing of the sanctions is also closely tied to recent diplomatic developments. Just days before the U.S. announcement, France, Britain, and Germany triggered what’s known as a “snapback mechanism”—a provision in the 2015 Iran nuclear deal that allows for the automatic reimposition of all United Nations sanctions on Iran. The European countries argued that Iran had willfully departed from its commitments under the 2015 agreement, which originally provided sanctions relief in exchange for limits on Iran’s nuclear program. With the snapback now in effect, Iran faces renewed international isolation, and the U.S. sanctions add yet another layer to the country’s growing economic woes.
The broader context is one of mounting tension and diplomatic gridlock. Earlier in 2025, the U.S. and Iran made tentative moves toward resuming negotiations on a new nuclear deal, but those talks have been frozen since a dramatic escalation in military conflict. In a span of just two weeks, Israeli forces carried out a 12-day bombardment of Iranian nuclear and military sites, followed by a U.S. bombardment on June 22. Since then, diplomatic channels have gone cold, leaving the fate of any future deal in serious doubt. As of mid-September, there has been no sign that negotiations will restart anytime soon.
For Iran, the use of cryptocurrency is not just a matter of convenience—it is a lifeline. With traditional banking routes blocked by sanctions, digital currencies offer a way to move funds quickly and, at least in theory, anonymously. But as the U.S. and its allies ramp up their scrutiny of blockchain transactions and tighten the net around front companies, that window may be closing. The Treasury’s latest crackdown is intended to make it harder for Iran to fund not only its government and military but also what U.S. officials describe as “malign activities” throughout the region.
It’s worth noting that the effects of these sanctions are not confined to Iran alone. By targeting individuals and firms in Hong Kong and the United Arab Emirates, the U.S. is sending a message to international partners and financial centers: cooperation with Iran’s sanctioned entities carries significant risks. The denial of access to U.S. financial systems is a powerful deterrent, and for many global businesses, the threat of secondary sanctions can be just as damaging as the primary measures themselves.
Cryptocurrency’s role in international sanctions evasion is a topic that has drawn increasing attention from regulators and policymakers worldwide. While digital currencies offer legitimate benefits—such as lower transaction costs and financial inclusion—they also create new vulnerabilities. The Chainalysis report cited by the Treasury is a stark reminder of the scale of the problem: nearly two-fifths of all illicit crypto transactions in 2024 were linked to sanctioned actors, with Iran among the most prominent beneficiaries.
As the international community grapples with how to enforce sanctions in a rapidly evolving financial landscape, the U.S. actions against Derakhshan, Alivand, and their associates are likely to set a precedent. Whether these measures will be enough to halt Iran’s shadow banking operations remains to be seen, but for now, Washington is making it clear that it is prepared to use every tool at its disposal.
With diplomatic options dwindling and technological workarounds proliferating, the standoff between Iran and the West shows no sign of abating. The latest sanctions, layered atop renewed U.N. penalties and the collapse of nuclear talks, represent a new phase in a conflict where money, technology, and geopolitics are inextricably intertwined. The world will be watching to see what comes next.