The US Department of the Treasury has added 134 cryptocurrency wallets connected to the ISIS-Khorasan group to its sanctions list. According to the updated data from the Office of Foreign Assets Control (OFAC), 131 of these wallet addresses are on the Tron network, while 3 are based on the Monero network.
Majority of sanctioned wallets are on Tron
Data from Chainalysis reveal that the sanctioned Tron wallets have received more than $1.4 million in assets since 2023, with over $880,000 leaving these addresses in the same period. The firm also reported that Tether, a leading stablecoin issuer, has frozen the balances associated with 131 Tron wallets now under sanctions.
OFAC, operating under the US Department of the Treasury, placed 134 crypto wallets linked to ISIS-Khorasan on its sanction list, with 131 on Tron and 3 on Monero.
ISIS-Khorasan, known as the branch of ISIS operating in Afghanistan, Pakistan, and Central Asia, has previously attempted to raise crypto donations through its media arm, Al Azayim Media Foundation, on websites and messaging platforms. Chainalysis noted that some wallets newly added to the sanctions list have transferred crypto funds to exchanges based in Syria.
Mini glossary: OFAC is a division within the US Treasury that manages sanction lists. Any individual, company, or wallet placed on OFAC’s list is banned from transacting with US-linked persons or establishments.
Tron network previously under regulatory scrutiny
Tron, the blockchain founded by Justin Sun, has previously been a focus for US authorities as a network used by entities facing sanctions. Earlier this year, Tether froze $344 million worth of USDT held in Tron wallets identified by federal authorities as tied to illicit activities.
Tron is known for its low transaction fees and fast transfer capabilities. While these features support various legitimate uses, they also make the network an attractive option for entities seeking to avoid sanctions.
Rising tensions between Justin Sun and World Liberty Financial
This latest round of sanctions comes amid an ongoing legal battle between Tron founder Justin Sun and World Liberty Financial, a crypto firm reportedly linked to former President Donald Trump’s family. In April, Sun filed a lawsuit alleging that his tokens were unlawfully frozen and that his governance rights had been taken away by the company.
On Monday, World Liberty Financial filed a lawsuit in Florida, accusing Justin Sun of short-selling its WLFI token last fall and intentionally pressuring its price. The firm also claimed that, after the freezing of assets, Sun initiated a smear campaign against the platform.
Additional sanctions announced for Brazil-connected entities
In a separate action on Wednesday, OFAC placed two Brazilian nationals and four companies on its sanctions list. US authorities allege that these entities, affiliated with the Brazilian criminal group Primeiro Comando da Capital, moved over $30 million in narcotics proceeds from the US to Brazil using cryptocurrency.
