Two brothers from the elite Harrazi family, using an alternate last name, founded Nobitex in 2018. The cryptocurrency exchange has become a central hub in a parallel financial system that moves funds outside of U.S. sanctions – even during the current war.
The sons of an influential family with close ties to Iran’s new supreme leader control the country’s largest cryptocurrency exchange, transforming it from a startup into a conduit to the global economy used by sanctioned government agencies and ordinary citizens alike.
The company has quickly inserted itself into Iran’s economy. Nobitex claims 11 million users, representing more than 10% of Iran’s population. Left out of access to international banking services, facing devaluation of the rial and rampant inflation, ordinary Iranians are using the exchange to buy and store cryptocurrency.
While Iran is under comprehensive Western economic sanctions, the exchange has escaped sanctions from the United States and its allies. Reuters was unable to find any indication that anyone in the Kharrazi family has been sanctioned by Western governments, and was unable to find out why Nobitex has escaped the same sanctions that have been imposed on other major Iranian economic players.
Who outsmarted the U.S.?
Brothers Ali and Mohammad Kharrazi, who use the surname Agamir, have turned Nobitex into the country’s leading cryptocurrency provider. It is estimated to account for about 70% of all cryptocurrency transactions in Iran. It’s not uncommon for some Iranians to have and use alternate last names. But the brothers seem to be the only ones in their family who regularly distance themselves from their famous lineage. (The Kharrazi family is one of the most influential dynasties in the Islamic Republic.)
As Reuters found out, Nobitex serves as a bridge to global cryptocurrency markets and a central hub in a parallel financial system used to move funds outside of Western sanctions. According to an analysis of blockchain records by cryptanalytics firm Crystal Intelligence and interviews with four private financial investigators, the Iranian state uses Nobitex to redirect money to allies outside the traditional banking system.
Reuters also spoke to nine Iranians who worked at or cooperated with Nobitex, including six who said they were aware of state funds subject to Western sanctions passing through the exchange.
In statements emailed to Reuters, Nobitex denied having direct ties to the government or assisting the state, and said any illicit funds passing through the exchange were done without the approval or knowledge of management. The company said the brothers had not changed their identities or used alternate identities.
The company also said that any transactions involving government entities were well below the estimates provided by investigators to Reuters.
