Israel Seizes $1.5M in Crypto Linked to Iran

Israel Seizes Crypto Wallets Linked to Iran’s IRGC

The Ministry of Defense in Israel announced on Monday the ordering of a seizure impacting 187 cryptocurrency wallets. These wallets are suspected of being owned by Iran’s Islamic Revolutionary Guard Corps, commonly known as the IRGC.

Details of the Seizure Order

According to a document outlining the seizure, Israel’s National Bureau for Counter Terror Financing (NBCTF) expressed firm conviction. The bureau believes the listed cryptocurrency wallets are the property of the IRGC.

Furthermore, the NBCTF asserts these wallets are utilized in the commission of serious terrorist acts.

International Sanctions Against the IRGC

The IRGC is currently designated as a terrorist organization by multiple international entities. These include the United States, the European Union, and Israel itself.

Financial Activity and Current Holdings

Blockchain analytics firm Elliptic reports that the identified wallets have accumulated $1.5 billion in Tether’s stablecoin, USDT, over time.

However, Elliptic’s co-founder and chief scientist, Tom Robinson, clarified that the firm cannot definitively confirm the IRGC’s ownership of these wallets.

Currently, the wallets hold only $1.5 million, representing a significant decrease from the total volume of funds previously processed.

Lack of Official Comment

Israel’s Ministry of Defense has not yet responded to inquiries from TechCrunch. The inquiry sought clarification on the methods used to establish the connection between the 187 wallets and the IRGC.

Potential for Indirect Ownership

Elliptic noted in a blog post that some of the addresses may be managed by cryptocurrency service providers.

This suggests the possibility that these addresses are part of a larger wallet infrastructure used to facilitate transactions for numerous customers.

Possible Intelligence Gathering Methods

Amir Rashidi, director of digital rights and security at the Iran-focused Miaan Group, suggests a potential scenario.

Rashidi posits that Israel may have obtained information about these wallets through cyberattacks targeting Iranian infrastructure.

He also mentioned longstanding rumors regarding the IRGC’s use of cryptocurrency to bypass international sanctions.

Complex Financial Networks

Rashidi explained that the connections may not be direct.

He stated that some entities involved might be exchanges linked to the IRGC, similar to the relationships between banks and other financial institutions.

Previous Targeting of Iranian Crypto Assets

This is not the first instance of Israel, or groups believed to be aligned with it, targeting Iran’s government-held cryptocurrency assets.

The Nobitex Hack

On June 18th, during a period of heightened conflict between Israel and Iran, a hacking group known as Predatory Sparrow, suspected of having ties to the Israeli government, compromised Iran’s largest crypto exchange, Nobitex.

The hackers successfully stole approximately $90 million worth of cryptocurrency and subsequently “burned” the funds by transferring them to inaccessible wallets.