Iran is Using Crypto to Buy Weapons to Work Around International Sanctions

Iran has taken steps to widen how it accepts payment for military exports, indicating it is prepared to take crypto in addition to its national currency and non-cash exchanges. The country’s Ministry of Defense Export Center (Mindex) has set out terms aimed at foreign buyers seeking to purchase items ranging from ballistic missiles and naval vessels to other defense-related hardware.

Mindex promotes its ties with 35 nations and operates an online showcase listing weapons systems, rockets, munitions, and amphibious craft. While references to alternative settlement options appeared as early as 2025, recent disclosures suggest a more defined framework designed for transactions that stall when banks decline to process payments or subject them to lengthy reviews.

Iran remains under heavy sanctions imposed by the U.S., the U.K., and the EU. The measures target oil income, weapons development, and access to international banking networks. In response, Tehran has increasingly relied on indirect methods to keep trade flowing, such as barter trade, discreet shipping networks, and digital currencies.

The U.S. has responded by expanding sanctions lists, recently adding dozens of vessels accused of transporting oil covertly. Officials have also identified two Iranian citizens alleged to have facilitated over $100 million worth of transactions using Bitcoin and other cryptocurrencies between 2023 and 2025. Authorities say those deals were used to complete oil sales on behalf of the state.

Cryptocurrency transfers can move across borders quickly, even outside normal banking hours, and reduce the number of intermediaries involved. Buyers of military equipment may see fewer delays tied to bank checks, while sellers gain quicker access to funds and reduce their dependence on the U.S. dollar.

The approach, however, carries legal and regulatory risks. Blockchain transactions are not as opaque as some users assume. Compliance tools can track funds across networks, including through mixers and over-the-counter brokers. Exchanges risk severe penalties if they process transactions linked to sanctioned parties. For potential buyers, legal advisers must assess whether contract terms could expose them to secondary sanctions or violate export-control laws.

Language on the Mindex platform emphasizes reliable delivery aligned with national policies aimed at working around sanctions. Outside Iran, that message is read differently. Compliance specialists warn that regulators can still trace digital payments, seize assets, and pressure insurers, shipping companies, and ports to withdraw support. As a result, logistics and coverage can become more complicated when enforcement risks rise.

The acceptance of digital assets by a state entity for weapons sales is likely to sharpen debates among regulators. Policymakers may move to tighten rules around stablecoin issuance, crypto custody, and cross-network transfers. Exchanges, liquidity providers, and private brokers could face tougher vetting standards and expanded wallet blacklists.

As what is or isn’t permitted in crypto transactions gets more clarity, industry players like Bullish (NYSE: BLSH) will be taking note and assessing how to structure their future plans.

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