Since the outbreak of the Iran war, cryptocurrency activity in the country has spiked, providing both a financial lifeline for civilians and new channels for state actors, experts say. Analysts report that Iran’s Revolutionary Guards are using digital currencies to circumvent Western sanctions and to fund allied militias.
Cut off from the traditional financial system due to decades of international sanctions, Iran has long relied on cryptocurrencies to sell embargoed oil and discreetly support armed groups such as the Houthi rebels in Yemen, according to US authorities. The current conflict has intensified this reliance.
Data from blockchain analytics firm Chainalysis shows that more than $10 million (€8.7 million) worth of cryptocurrencies left Iranian exchange platforms between 28 February, the first day of Israeli-US airstrikes, and 2 March. By 5 March, nearly one-third of these funds had moved to foreign exchanges.
While part of this movement reflects citizens seeking to protect their savings from economic instability, the scale of the transfers suggests involvement by state actors, said Kaitlin Martin of Chainalysis. Experts note that such actions are likely driven by fears of additional sanctions or cyberattacks.
During the previous Israel-Iran conflict in June 2025, the Iranian crypto platform Nobitex lost $90 million (€78.1 million) to hackers linked to Israel, according to blockchain security company TRM Labs.
Chainalysis and other analysts report that several wallets active in the recent surge are directly linked to the Revolutionary Guards. Cryptocurrency firm Elliptic highlighted that some outflows occurred even during internet outages, indicating that the Guards may have remote access to exchange holdings.
Last year, wallets associated with the Revolutionary Guards received more than $3 billion (€2.6 billion) in cryptocurrencies, representing over half of Iran’s total crypto flows, a share that continues to grow. The Financial Times has reported that Iran has offered ballistic missiles, drones, and other advanced weapons for sale using digital currencies, contributing to a so-called “shadow banking” system, according to Craig Timm of anti-money laundering organization ACAMS.
Experts note that stablecoins, digital currencies pegged to the US dollar, are favored by the Revolutionary Guards and the Iranian central bank to avoid volatility. Civilians, meanwhile, are increasingly turning to bitcoin, which can be withdrawn and stored in personal wallets beyond state control. Bitcoin currently trades above $68,000, providing an alternative to a national currency weakened by nearly 50% inflation before the conflict.
Analysts say cryptocurrencies are now acting as a financial lifeline for ordinary Iranians, enabling them to protect savings and make transactions despite sanctions and economic turmoil. The surge in digital assets underscores the growing role of crypto in conflict zones and the challenges it poses for global regulation.
Experts say Iran’s Revolutionary Guards are using cryptocurrencies to circumvent Western sanctions and finance allied militias.
