The U.S. government has filed a civil forfeiture complaint seeking to seize $61 million in cryptocurrency linked to illicit Iranian oil sales to Chinese buyers. The case, brought by the U.S. Attorney’s Office for the Southern District of New York, alleges Tehran used a complex network of cryptocurrency actors, particularly in China, to launder over $1.5 billion derived from black-market petroleum sales. These funds reportedly supported the Iranian military and the Islamic Revolutionary Guard Corps (IRGC), financing activities deemed hostile to the U.S. and its allies.

Two Chinese firms, Blessed Trust and Hexa Whale, are central to the allegations. These companies allegedly operated trading accounts on Binance, facilitating the laundering of illegal proceeds from Iranian oil sales and funneling the money back to Tehran and affiliated proxies. The complaint states that both firms provided “on-ramp” services to convert fiat currency into cryptocurrencies and used the U.S. financial system to transfer substantial sums as part of this network. Binance has responded by emphasizing its zero-tolerance policy for sanction violations and its cooperation with law enforcement.

The U.S. complaint also highlights plans by Tether Ltd. to burn the targeted tokens and issue replacements of equivalent value, which would then be transferred to U.S. government custody. This move aims to neutralize the illicit funds linked to Iran. These developments follow a broader tightening of sanctions, including actions taken earlier in 2026 against a Chinese refinery processing Iranian oil and warnings to financial institutions about dealing with entities involved in the trade.

Iran reportedly used barter arrangements to evade sanctions while China remains Iran’s largest oil buyer, importing around 1.4 million barrels per day in 2025. The U.S. effort to recover laundered cryptocurrency represents another step in its campaign to disrupt the financial networks supporting the Iranian regime’s sanctioned activities. The case sheds light on the increasing use of cryptocurrencies in circumventing global trade restrictions and sanctions enforcement.