Sanctioned entities and jurisdictions were responsible for nearly $16 billion in cryptocurrency activity last year, driven in part by a resurgence of activity in the mixing service Tornado Cash and a spike in the use of crypto in Iran. The amount of cryptocurrency flowing into the mixer is down overall since sanctions were put in place — including a 90% drop immediately afterwards — but Tornado Cash still processed about $100 million each month last year. Under the weight of sanctions attempting to cut off Iranian access to the Western banking sector, Iran showed a remarkable turn to digital currencies in 2024. That tense situation likely triggered a spike in outflows of cryptocurrency from Iran, first on April 9 and then on April 14, the day after Iranian-backed militant groups launched hundreds of drones at Israel. “A closer examination of these outflows suggests they are not necessarily driven by illicit finance or state-sponsored activity, but rather by Iranian citizens’ deepening distrust in the government and a pressing need to move funds out of the country,” Chainalysis said. Overall, OFAC issued 13 sanctions designations in 2024 that included cryptocurrency addresses, the second-highest amount in the last seven years. In 2024, Chainalysis said, nearly a quarter of inflows into the platform were stolen — including $145 million in Ethereum stolen from the Heco Chain blockchain protocol, allegedly by North Korean hackers. “From a regulatory standpoint, the distinction between state-directed sanctions evasion and individual use has little impact, as broad sanctions prohibit nearly all financial interactions between U.S. persons and entities in sanctioned jurisdictions, regardless of intent,” Chainalysis said. Separately, individual Iranians moved more money out of the country’s beleaguered financial system and into cryptocurrency in 2024 than ever before, the report said. Outflows of cryptocurrency from Iran reached $4.18 billion in 2024, up about 70% year-over-year.
This Cyber News was published on therecord.media. Publication date: Wed, 19 Feb 2025 13:05:08 +0000