The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned eight cryptocurrency wallets linked to the Russian exchange Garantex and Yemen's Houthi rebel group. Blockchain analysis from Chainalysis and TRM Labs revealed that the wallets moved nearly $1 billion tied to sanctioned entities — much of it funding Houthi military operations in Yemen and the Red Sea.

Of the eight wallets, two were tied to major crypto platforms, while six were privately controlled. According to experts, these sanctions mark a turning point in how crypto is viewed in global security. Slava Demchuk, a money laundering consultant and UN advisor, noted that the move reflects the growing use of digital assets in geopolitical conflicts and terror financing. He warned that decentralized platforms may now face heightened global scrutiny.

The Houthis, officially known as Ansar Allah, are a political and militant movement rooted in Yemen’s Zaidi Shia community. They’ve been behind numerous missile and drone attacks on vessels in the Red Sea, threatening global trade and regional stability. Earlier this year, the U.S. designated the group as a foreign terrorist organization and recently targeted them in military airstrikes.

Garantex, the Russian exchange involved, was sanctioned in March and effectively shut down after being accused of enabling money laundering. Tether froze $27 million in USDt on the platform during the clampdown. Despite efforts to rebrand as “Grinex,” Garantex remains under legal fire. In March, Indian authorities arrested Lithuanian national Aleksej Bešciokov, alleged to be the platform’s operator, on U.S. charges including conspiracy to launder money and violations of international economic laws.

This development underscores Washington’s increasing efforts to disrupt terror finance networks using blockchain.