Dubai’s virtual-asset regulator has fined an unlicensed cryptocurrency exchange and ordered it to shut down after investigators tied it to certainly one of the world’s largest illegal online gambling networks and a $4 billion Iranian sanctions-evasion operation.
The exchange, Shelbit, sat at the middle of a money-moving system that gave a sprawling Farsi-language gambling network, Iran’s central bank, and other sanctioned Iranian entities access to global cryptocurrency markets, in line with a Reuters investigation published on July 31, 2026 that drew on blockchain data from two crypto-investigation firms and an independent analyst.
On July 24, 2026, the Virtual Assets Regulatory Authority, referred to as VARA, issued a notice imposing financial penalties on Shelbit General Trading and ordered it to stop all unlicensed virtual-asset activity in or from Dubai. The regulator found the exchange still serving customers and not using a licence, onboarding users without the identity checks UAE law requires, and marketing itself without authorisation, all in breach of the emirate’s anti-money-laundering and counter-terrorism-financing rules.
VARA forged the case as greater than a consumer-protection failure. The exposure it identified, the regulator said, “extends beyond consumer protection to more egregious cross-border transactions with the propension to affect the integrity of the UAE economic system.”
It was not VARA’s first move against Shelbit. The regulator and Dubai’s Department of Economy and Tourism had already taken motion in 2025, when VARA issued a cease-and-desist notice in January and fined the exchange for offering and promoting unlicensed services. The cash kept moving anyway.
What the investigation found
The blockchain records reviewed by Reuters show Shelbit processed a minimum of $4 billion in cryptocurrency since May 2024, when it appears to have begun operating. Its foremost customers included a gambling operation of greater than 2,000 Farsi-language web sites offering slots, blackjack, and roulette to players inside Iran, where betting is banned.
“That is by far the most important Iranian illegal gambling network ever discovered and certainly one of the most important on this planet,” said John Wojcik, a former Infoblox researcher who spent seven years investigating illegal gambling for the United Nations before joining the blockchain-analytics firm TRM Labs.
The 2 men who front the sites, Iranian musicians and social-media influencers Sasha Sobhani and Pooyan Mokhtari, were convicted in absentia in Iran in 2023 over illegal gambling, together with Shelbit founder Siavash Kayvanpour. Iran’s penal code punishes gambling with prison and lashes, and was amended in 2023 to cover online betting. Each influencers denied any involvement in money laundering or sanctions evasion and said they didn’t know Kayvanpour or Shelbit.
Illegal online gambling has develop into a well-liked channel for cross-border laundering, and enforcers across Asia have dismantled a series of betting rings, including a Taiwan operation that led to the arrest of a former Macau junket director. What sets the Iranian network apart, investigators say, is its direct wiring right into a sanctioned state. Reuters reported that Shelbit interacted with Iran’s central bank, processing a minimum of $125 million tied to it, in addition to with an Iranian exchange the US sanctioned earlier in 2026 and with wallets Israel has linked to the Islamic Revolutionary Guard Corps. Former Iranian officials told the agency the Guard Corps had taken over the country’s online gambling to maneuver money abroad, though Reuters said it couldn’t confirm that the Guard Corps directly controlled Shelbit or the network.
The Binance exposure
No less than $676 million flowed from Shelbit-linked wallets to Binance, the world’s largest crypto exchange, since May 2024, the info reviewed by Reuters shows. About $540 million of that moved after VARA’s 2025 high-quality.
Binance told Reuters that Shelbit never held an account on its platform and had never been sanctioned, and that the flows tied to it weren’t judged high-risk by an outdoor analytics firm. When users connected to Shelbit did touch the platform, the corporate said, it investigated the accounts, froze them, and reported them to law enforcement. Binance didn’t dispute processing the cash.
The exchange isn’t any stranger to this type of scrutiny. US authorities fined Binance $4.3 billion in 2023 over anti-money-laundering failures that included processing Iranian crypto trades, and the corporate secured regulatory licences for its foremost trading platform within the UAE in December 2025.
A widening crackdown on Iranian crypto
The Shelbit case lands as US regulators tighten pressure on Iran’s digital-asset infrastructure. On June 2, 2026, the US Treasury’s Office of Foreign Assets Control designated Nobitex, Iran’s largest digital-asset exchange, together with three smaller Iranian platforms, over transactions tied to the Guard Corps and other sanctioned entities. Iran’s central bank has been under US counter-terrorism sanctions since 2019. A Treasury spokesperson told Reuters the office was aware of the Shelbit allegations and was taking them seriously.
For regulators, the episode shows how unlicensed exchanges and illegal betting can mix right into a laundering channel that strange banking controls miss. Financial watchdogs and gambling regulators increasingly treat the 2 as one problem: Australia’s regulator ordered bet365 to overhaul its money-laundering systems, and Britain is consulting on criminal penalties for sponsors of unlicensed gambling.
VARA’s notice doesn’t name the influencers or settle who ultimately controlled the cash, questions Reuters said it couldn’t answer either. What the regulator has placed on the record is narrower and firm: an exchange operating in Dubai and not using a licence, moving billions across borders in breach of the emirate’s money-laundering rules, and now ordered to stop.