Treasury Sanctions ISIS-Linked Crypto Wallets, Primarily on Tron Network
The U.S. Treasury Department has imposed sanctions on over 130 cryptocurrency wallet addresses linked to ISIS, with a significant majority operating on the Tron blockchain.
The department’s Office of Foreign Assets Control (OFAC) added 134 crypto wallets to existing sanctions against ISIS-K, the Islamic State’s affiliate active in Afghanistan, Pakistan, and Central Asia. Of these, 131 were identified on the Tron network and three on Monero.
According to blockchain analytics firm Chainalysis, the sanctioned Tron addresses have collectively received more than $1.4 million since 2023 and disbursed over $880,000 during the same period. Chainalysis also reported that stablecoin issuer Tether has frozen the balances associated with all 131 sanctioned Tron wallets.
ISIS-K’s media wing, the al-Azaim Media Foundation, has a documented history of soliciting cryptocurrency donations through websites and messaging platforms. Chainalysis indicated that several of the newly sanctioned wallets transferred cryptocurrency to exchanges based in Syria.
The Tron blockchain, founded by cryptocurrency entrepreneur Justin Sun, has previously been utilized by entities subject to U.S. government sanctions or scrutiny. Earlier this year, Tether froze $344 million worth of USDT held in Tron wallets that federal authorities had flagged for connections to illicit activities.
The latest sanctions targeting ISIS-related Tron wallets occur amidst a notable deterioration in Sun’s relationship with the family of former President Donald Trump. Sun, once a prominent financial supporter of the Trump family’s cryptocurrency ventures, filed a lawsuit in April against their crypto platform, World Liberty Financial, alleging unlawful freezing of his tokens and removal of governance rights.
World Liberty has since filed a countersuit for defamation, accusing Sun of orchestrating a campaign to depress the token’s price and subsequently defaming the company after his assets were frozen.
In a separate action on Wednesday, OFAC also sanctioned two Brazilian nationals and four companies connected to the criminal organization Primeiro Comando da Capital (PCC). The department alleges these entities used cryptocurrency to move more than $30 million in drug trafficking proceeds, generated in the United States, back to Brazil.
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