U.S. sanctions hit 134 ISIS-K crypto wallets as Tether freezes linked funds

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US sanctions ISIS-K crypto wallets

Highlights

The U.S. Treasury's OFAC adds 134 cryptocurrency wallet addresses linked to ISIS-K to the Specially Designated Nationals list on Wednesday.
Tether freezes funds in 131 sanctioned Tron addresses as Chainalysis reports these wallets received over $1.4 million and sent over $880,000 in crypto since 2023.
Blockchain analytics tools, cited by Chainalysis and TRM Labs, are increasingly used to identify, freeze, and prosecute illicit crypto flows supporting terrorism financing.

Sanctions action targets wallets and donation flows

As reported by Cointelegraph, citing the U.S. Department of the Treasury's Office of Foreign Assets Control, 134 cryptocurrency wallet addresses identified as belonging to ISIS-K are added to its Specially Designated Nationals list on Wednesday. ISIS-K has been designated a Specially Designated Global Terrorist since September 2015, and the SDN list covers individuals, entities and digital asset addresses tied to terrorism, narcotics trafficking and other illicit activity.

Chainalysis says Tether freezes balances associated with 131 sanctioned Tron addresses, while the remaining three addresses are on the Monero network. The move comes more than a week after OFAC's previous sanctions round on June 22, when it sanctioned three individuals and six entities across Europe, the Middle East and West Africa, including Syria-based MSB Bitcoin Xchange and Turkish MSB Spider.

OFAC says that earlier action targets key facilitators enabling ISIS to move funds among its regional affiliates. Chainalysis says ISIS-K has historically solicited cryptocurrency through donation campaigns on websites and messaging platforms.

Blockchain analytics gain role in terrorism finance enforcement

Chainalysis says the 131 Tron addresses in the latest sanctions round receive more than $1.4 million in crypto donations since 2023 and send more than $880,000. The firm also identifies multiple donation addresses used by the group across Tron, Monero and Bitcoin, and says it finds significant exposure to mainstream services, including wallets that send funds to Syria-based cryptocurrency exchanges.

Blockchain analytics tools are taking a larger role in financial sanctions and enforcement targeting illicit activity. In April, TRM Labs says onchain evidence is key to securing the conviction of three individuals for terrorism financing in Indonesia in 2024 and 2025, adding that wallet addresses, transaction histories and onchain flows are admissible and can underpin prosecution.

In our earlier article on the U.S. Treasury’s Trump Accounts investment lineup, we outlined how the federal child savings program is set to launch July 4 with a $1,000 government seed deposit for eligible children born between 2025 and 2028. We noted that initial contributions would default into a low-cost S&P 500 index ETF at launch, with plans to expand the menu to additional low-fee index ETF options across major issuers once account selection tools become available.

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