Here’s a protection racket that would make the mob blush. Iran has allegedly been forcing commercial ships to purchase insurance policies, covering risks that Iran itself creates, and accepting payment in digital assets to dodge the very sanctions meant to cut it off from the global financial system.

The US Treasury’s Office of Foreign Assets Control sanctioned two firms on July 29: the Persian Gulf Marine Insurance Company (PGMIC) and HormuzSafe Marine Services Authority. Both are accused of operating under the umbrella of the Islamic Revolutionary Guard Corps (IRGC), running a scheme that requires commercial vessels to buy mandatory maritime insurance just to navigate the Strait of Hormuz.

The scheme: create the danger, sell the protection

The Strait of Hormuz is one of the most strategically important waterways on Earth. Roughly a fifth of the world’s oil passes through it daily, and Iran sits on its northern shore.

The designated insurance policies reportedly cover risks that Iran itself generates, including vessel seizures and harassment by IRGC naval forces. The insurance policies are structured to facilitate payments in digital assets, giving Iranian entities a way to collect revenue while sidestepping traditional banking channels where US sanctions have the most bite.

The designations were made under Executive Order 13902, which targets Iran’s financial sector. OFAC also sanctioned eight shipping companies based in China, Hong Kong, and the Marshall Islands for their ties to Iran’s petroleum industry.

Bitcoin as a sanctions evasion tool

This action didn’t come out of nowhere. Reports surfaced as early as May 2026 about Iran’s Bitcoin-settled insurance initiative for Hormuz transit, suggesting the HormuzSafe platform was part of a broader effort to build a digital financial ecosystem that operates outside Western control.

That makes enforcement significantly harder than simply flagging suspicious wallet addresses. You’re dealing with what appears on the surface to be a commercial transaction between a shipping company and an insurance provider. The fact that the insurer is an arm of the IRGC and the payment rails run through crypto adds layers of complexity that regulators are still learning to navigate.

What this means for crypto markets and regulation

The immediate market impact appears limited. Bitcoin and major digital assets haven’t shown significant movement tied specifically to this action.

The connection between Iran’s shadow fleet and companies in China, Hong Kong, and the Marshall Islands also highlights how sanctions enforcement in crypto is becoming a geopolitical exercise, requiring coordination across jurisdictions with very different attitudes toward both crypto regulation and Iran.

The irony of Iran’s scheme is worth noting. The same transparency properties that make blockchain useful for sanctions enforcement also make it useful for sanctions evasion. Digital asset payments leave a trail, which is both a feature and a bug depending on which side of the enforcement equation you’re standing on.