Crypto Sanctions Evasion Surged 700% in 2025, Chainalysis Says

The United States has long used financial sanctions to restrict Iran’s access to dollars and cross-border payment services, prompting local businesses to turn to cryptocurrency. TRM Labs tracked about 60 wallets linked to sanctioned Iranian entities. Their transactions involved CoinEx and Nobitex, highlighting sanctions-compliance and anti-money-laundering risks at centralized exchanges.

A TRM Labs report said the wallets had moved more than $3.84 billion in cryptocurrency through CoinEx since 2019. About $2.7 billion, or roughly 70% of the total, went to Nobitex, Iran’s largest domestic exchange. CoinEx subsequently denied serving as a funding gateway for sanctioned Iranian crypto companies, leaving the two sides at odds over the exchange’s responsibility.

Following financial sanctions on Russia, crypto assets, stablecoins and central bank digital currencies have increasingly served as alternative channels for cross-border settlements. The European Commission has therefore made closing sanctions-evasion routes a central element of its 20th package of measures against Russia. The package covers service providers in Russia and Belarus and brings trading platforms, tokens and the digital ruble within the financial blockade.

The EU's latest proposal is its largest Russia sanctions package in two years and is scheduled to take effect on May 24, 2026. It would prohibit EU operators from transacting with Russian and Belarusian crypto service providers and seeks to block 11 platforms that assist Russia. Ruble-backed stablecoins including A7A5 and RUBx, as well as the digital ruble issued by Russia's central bank, are also designated as prohibited instruments for transactions and sanctions evasion.

Blockchain analytics company Chainalysis said groups linked to Russia and Iran are using cryptocurrency to pay for military drones and critical components, circumventing international sanctions and scrutiny by the traditional financial system. Although cryptocurrency is pseudonymous, its public and difficult-to-alter onchain transaction records also make fund flows an important lead for law-enforcement investigations.

A recent Chainalysis report found that the procurement networks have used onchain transfers to support military supply chains. The available information did not specify the report’s publication date, the total amount involved or the timing of individual transactions. The report said analyzing wallet addresses, fund-transfer routes and counterparties can help identify sanctions-evasion procurement by Russia- and Iran-linked groups, as well as nodes in their supply chains.

Cryptocurrencies have become an important channel for some Russian entities seeking to move funds across borders and convert rubles as international sanctions restrict access to conventional finance. Garantex had served as a major hub for such activity before it was blocked, leaving a market gap that drew greater scrutiny to replacement exchanges and over-the-counter networks.

Blockchain analytics firm Elliptic said in a new report that exchanges including Bitpapa and ABCeX are helping Russian entities circumvent sanctions by facilitating conversions between rubles and crypto assets. The network expanded to fill the vacuum left by Garantex, while cryptocurrency received by illicit addresses climbed to a record $154 billion in 2025, underscoring the growing scale of sanctions-evasion and other unlawful financial activity.