U.S. Treasury Imposes Sanctions on 134 ISIS-Connected Crypto Wallets

U.S. Treasury Targets ISIS-Connected Crypto Wallets

The U.S. Treasury Department has imposed sanctions on 134 cryptocurrency wallets tied to ISIS-K, the Islamic State's faction operating primarily in Afghanistan and Central Asia. The majority of these wallets are based on the Tron blockchain.

According to the Office of Foreign Assets Control (OFAC), 131 of the sanctioned wallets are linked to Tron, while three are associated with Monero. Blockchain analytics firm Chainalysis reported that these Tron wallets have received over $1.4 million and transferred more than $880,000 since the beginning of 2023. Tether has since frozen the assets of all 131 sanctioned Tron wallets.

ISIS-K has previously solicited cryptocurrency donations through its media outlet, the al-Azaim Media Foundation, utilizing various websites and messaging platforms. Chainalysis noted that some of the newly sanctioned wallets have transferred funds to exchanges in Syria.

This action comes amid ongoing legal issues involving Tron founder Justin Sun and the Trump family's World Liberty Financial. Earlier this year, Tether also froze $344 million in USDT from Tron wallets linked to illicit activities. Sun, who had been a financial supporter of the Trump family's crypto operations, is currently embroiled in a lawsuit against World Liberty Financial for allegedly freezing his tokens and revoking his governance rights.

In a separate move, OFAC sanctioned two individuals and four companies in Brazil associated with the Primeiro Comando da Capital (PCC) criminal group, accusing them of using cryptocurrency to launder over $30 million in drug trafficking proceeds from the U.S. back to Brazil.