Shelbit Linked to $4B Iran Sanctions Evasion Scheme

Woofun AI reports that Shelbit, an unlicensed Dubai-based exchange operated by Siavash Kayvanpour, serves as the central hub for a massive Iranian sanctions-evasion operation. Reuters identified this network as a primary conduit for moving funds from Iran’s central bank and other sanctioned entities into global cryptocurrency markets. The scheme leverages an extensive illegal gambling infrastructure to obscure the origin of capital flows.

The financial scale of this illicit operation is substantial, with the gambling network generating millions of dollars in cryptocurrency transactions. This ecosystem comprises more than 2,000 platforms, making it one of the largest illegal gambling networks globally. Shelbit acts as the critical financial intermediary, processing these vast sums and facilitating the movement of capital out of Iran. The volume of funds processed underscores the sophistication of the evasion tactics employed.

Structurally, the network relies on entities already under severe international pressure. The Central Bank of Iran has faced U.S. counterterrorism sanctions since 2019 due to its financial support for militant groups. These include the Islamic Revolutionary Guard Corps (IRGC), its Quds Force, and Hezbollah. The sanctions aim to cut off funding sources for these organizations, yet the Shelbit network appears to bypass these restrictions effectively.

Per Woofun AI, the company submitted data showing that Shelbit has transferred hundreds of millions of dollars to major industry players, including Binance. Despite these significant flows, Binance stated that Shelbit never held a direct account on its platform. The exchange maintained that transactions linked to Shelbit were not classified as high risk.

However, Binance confirmed it investigated associated users, froze relevant accounts, and reported findings to law enforcement authorities.

Expert analysis highlights the unprecedented nature of this discovery. John Wojcik, a senior analyst at TRM Labs and former Infoblox researcher, described it as the largest Iranian illegal gambling network ever identified. He previously investigated such networks for the United Nations Office on Drugs and Crime. This operation rivals the 2016 U.S. disruption of a $20 billion IRGC gold-for-oil scheme in Turkey.

Additionally, the U.S. seized $1 billion in crypto from Iran in May, indicating ongoing enforcement efforts.

Rich Sanders, an independent blockchain researcher, characterized the operation as clearly controlled by the IRGC. The IRGC, founded in 1979, remains Iran’s most powerful military and political institution, answering directly to Supreme Leader Mojtaba Hosseini Khamenei. Shelbit interacts with wallets linked to the IRGC by the Israeli government and Nobitex, an exchange sanctioned by the U.S. government earlier this year. Some funds originated from an Iranian bitcoin mining operation, further integrating state-backed infrastructure into the evasion network.