OFAC sanctions

OFAC (Office of Foreign Assets Control) is the unit of the U.S. Department of the Treasury that designs and enforces U.S. economic and trade sanctions. Its measures implement U.S. foreign-policy and national-security priorities and are legally binding on U.S. citizens, U.S.-based entities, and anyone operating through the U.S. financial system — which in practice covers most dollar payments worldwide.

SDN list and other lists

OFAC’s main public tool is the Specially Designated Nationals and Blocked Persons List (SDN). It includes individuals, entities, vessels, aircraft and, since 2018, crypto wallet addresses. Sanctioned subjects are cut off from the U.S. financial system, and transactions with them by U.S. persons are prohibited.

Besides the SDN, OFAC runs sectoral lists (such as SSI, Sectoral Sanctions Identifications) and country programs covering Iran, North Korea, Russia, Syria, Cuba, Venezuela, Myanmar, and others.

Crypto precedents

Several high-profile cases show how OFAC applies sanctions to crypto:

• BTC-e / WEX (2017-2018) — an exchange accused of processing criminal proceeds was placed on the SDN list and its operator detained.
• Garantex (2022) — a Russian exchange added to the SDN list, which led to widespread blocking on Western services and persistent flagging of its addresses in commercial analytics databases.
• Tornado Cash (August 2022) — an Ethereum mixer protocol. OFAC added a set of related smart contracts to the SDN list, sparking a broad debate over whether code can be sanctioned. In 2024 the Fifth Circuit Court of Appeals partially overturned the designation, ruling that immutable smart contracts are not “property” under the relevant statute. In March 2025, OFAC removed the Tornado Cash addresses from the SDN list.
• Hydra Market (2022) — a major darknet marketplace seized in a joint operation by German authorities and the U.S. Department of Justice, with associated addresses added to the SDN list.

Non-custodial wallets and developers

OFAC’s stance on non-custodial tools remains nuanced. On one hand, OFAC has clarified that U.S. persons must avoid interacting with sanctioned addresses and apply a risk-based approach. On the other, the Tornado Cash case and the arrest of developer Alexey Pertsev in the Netherlands (2022, convicted in 2024 by a Dutch court under local AML rules) showed that open-source developers can face criminal exposure, especially when their tool is used at scale to circumvent sanctions.

For TON developers and service operators this implies:

• address screening through commercial providers (Chainalysis, TRM Labs, Elliptic) is standard practice for exchanges and custodians;
• geofencing — blocking access from sanctioned jurisdictions by IP and KYC data;
• scrutiny of smart contracts that route significant volume, particularly mixers and privacy-oriented protocols;
• caution for U.S. persons — even contributing to code aimed at sanctions evasion may be interpreted as a violation.

What matters for the end user

OFAC cannot block anything on the TON network itself — private keys stay with their holders. But any attempt to off-ramp funds linked to sanctioned addresses through a regulated exchange or fiat provider is very likely to trigger a freeze and investigation. The screening is done by venues’ compliance teams using public lists, not by OFAC directly.

This is not legal advice; sanctions status changes frequently, and anyone with potential exposure to sanctioned addresses should consult qualified counsel rather than rely on online resources.