When Iran’s internet collapsed to roughly 1% of normal connectivity following U.S.–Israeli strikes, most digital services across the country went dark.
Email stopped working.
Websites disappeared.
Social media fell silent.
But the blockchain, apparently unaware of the blackout, kept moving hundreds of millions of dollars just fine.
According to a Report that mentioned cyber intelligence report from RAKIA, cryptocurrency infrastructure linked to Iran’s powerful Islamic Revolutionary Guard Corps continued operating even during the nationwide shutdown, allowing significant amounts of digital assets to move out of the country.
Which is awkward for the concept of financial isolation.
Internet Goes Dark
Following the Feb. 28 military strikes involving the United States and Israel, Iran reportedly implemented a sweeping internet blackout across much of the country.
Monitoring group NetBlocks estimated national connectivity dropped to roughly 1% of normal levels.
For most people, this meant the internet effectively ceased to exist.
For crypto wallets, it appears to have been more of a mild inconvenience.
Money Starts Moving
According to RAKIA’s analysis, crypto flows began rising within hours of the attacks.
Omri Raiter, the firm’s CEO, said the surge started with tens of millions of dollars moving through Iranian-linked wallets before quickly expanding.
Soon, the flows reached hundreds of millions.
“Money was just flowing out from Iranian crypto accounts,” Raiter said.
Which is precisely the sort of sentence that tends to make sanctions architects very uncomfortable.
A Sanctions Workaround That Won’t Turn Off
The report suggests Iran has developed a robust crypto-based financial infrastructure capable of operating even during heavy sanctions and communications shutdowns.
Blockchain analysis data cited in the report indicates wallets linked to the IRGC received more than $3 billion in cryptocurrency in 2025.
Meanwhile, analysis from Chainalysis estimated the broader Iranian crypto ecosystem handled roughly $7.78 billion in activity during the same period.
For context, that is a lot of digital money moving around for a country whose internet was, technically speaking, mostly turned off.
Two Flows, Same Pipeline
RAKIA’s analysis suggests the surge in transactions reflects two simultaneous trends.
The first is funding linked to Iran’s regional proxy networks.
The second appears to involve individuals connected to the regime moving their personal wealth somewhere safer than a war zone.
Raiter described the two as closely connected.
“The proxy war funding and the personal capital flight are two sides of the same coin.”
Which in this case may literally be a coin.
Geography Leaves a Trail
Some of the crypto flows reportedly moved toward regions historically associated with Iran-backed groups.
Investigators identified activity linked to networks operating in areas connected to proxy conflicts, including locations tied to financial pipelines running through parts of the Middle East.
In other words, the money followed routes that have existed long before the blockchain — the technology simply made them faster.
Sanctions Meet the Blockchain
The United States has increasingly tried to disrupt these financial pathways.
In January, the United States Department of the Treasury sanctioned cryptocurrency exchanges tied to Iranian actors, marking one of the first times the government targeted entire platforms rather than individual wallets.
Treasury Secretary Scott Bessent said the move was intended to disrupt networks helping Tehran bypass sanctions.
“The Treasury will continue to pursue Iranian networks and corrupt elites who enrich themselves at the expense of the people.”
Unfortunately for regulators, the blockchain is not especially responsive to strongly worded press releases.
The Irony of Decentralization
Crypto was originally promoted as a financial system resistant to censorship and government control.
Which it is.
The problem, from a sanctions perspective, is that this property works equally well for everyone.
Even during a nationwide internet blackout, the underlying financial rails appear to have continued functioning — quietly routing money across borders while much of the country remained offline.
In other words, the internet may go down.
But the blockchain, for better or worse, rarely does.
Disclaimer: This article is a work of satire and commentary intended for informational and entertainment purposes. This is a parody and should not be interpreted as factual reporting or as making real claims about any individual or organization.
