What are sanctions?

Most are economic sanctions: restrictions on trade, finance and access to property, applied instead of military force. They come in two shapes. Country programs, or embargoes, restrict trade and finance with a whole jurisdiction — the comprehensive US programs covering North Korea and Iran are the best-known examples. Targeted, list-based programs name specific people, companies, vessels, aircraft and other assets. Once a party is listed, its property is usually frozen, and anyone under the issuer's jurisdiction is barred from dealing with it.

The best-known list is the US Treasury's Specially Designated Nationals and Blocked Persons (SDN) list, kept by the Office of Foreign Assets Control (OFAC). Since November 2018, OFAC has published cryptocurrency wallet addresses in SDN records, and other issuers have followed. That is why compliance now covers on-chain activity, not just bank transfers.

A sanction, singular, is one restrictive measure imposed by a government or international body to change the behaviour of its target without using force. In practice it takes one of a few legal forms: a designation that blocks a named person or company and freezes its assets; a sectoral restriction that bans specific dealings, such as new debt or securities, with a listed party; a trade or financial embargo on a country or region; a travel ban; or an arms embargo.

"Sanctions" in the plural usually means the program — the set of measures an issuer applies to one target, such as OFAC's Iran program or the EU's Russia measures. That is why a screening result reports the program behind a match: the same designation can carry a full asset freeze under one program and a narrower restriction under another.

Sanctions are usually classified by scope: whether they apply to a whole jurisdiction, to a sector of its economy, or to named parties. Four of the six types below are economic sanctions, aimed at trade, finance and property; arms embargoes and travel bans are the non-economic ones. How a sanction works follows from that scope. A country program is enforced by knowing where a counterparty, user or shipment is; a list-based designation is enforced by screening who the counterparty is.

Designation and sanction are related but distinct terms. A designation is the administrative act of adding a person, company, vessel or wallet address to a list. The sanction is the restriction that follows from it — usually an asset freeze plus a prohibition on dealings.

For a person or company, being sanctioned means being designated by an issuer and placed on its list. The consequences follow at once: property and interests in property within the issuer's reach are blocked, and everyone subject to that jurisdiction is prohibited from dealing with the designated party — no payments, no services, no trade. In the United States the prohibition also covers entities owned 50 percent or more, directly or indirectly, by one or more blocked persons, even when those entities are not listed themselves (OFAC's 50 Percent Rule, set out in FAQ 401).

For a crypto wallet address, being sanctioned means the address is published as an identifier in a designated party's list record. Regulated services must then block or reject transactions involving it, which is why exchanges and DeFi front-ends screen addresses before value moves. In everyday speech "state-sanctioned" can also mean officially approved; this page uses the legal sense throughout.

There is no single global list. The United Nations Security Council issues designations that member states implement, and each jurisdiction runs its own programs on top, with its own list, legal basis and update schedule. A business that operates across borders can fall under several regimes at once. Lists overlap a lot, but never completely.

The issuers that matter most to financial products:

The rules attach to who you deal with, not what technology you use. A stablecoin transfer to a designated wallet raises the same legal issues as a wire to a designated bank account. In the US, civil enforcement is strict liability: a violation does not require intent or knowledge, although both affect the penalty.

Crypto is squarely in scope. OFAC has designated hundreds of wallet addresses as identifiers of listed persons, from ransomware operators to North Korea's Lazarus Group. It has also listed whole platforms: the Russian exchange Garantex was designated in April 2022 for laundering illicit funds. Designations move in both directions, too. The smart-contract mixer Tornado Cash was designated in August 2022, then removed from the SDN list in March 2025 after litigation over whether immutable smart contracts can be "property". Screening against stale list data therefore produces both missed matches and false positives.

For exchanges, payment companies, DeFi frontends and other virtual asset service providers, the practical result is a screening duty: check counterparties and wallet addresses against current list data before value moves, and check again as the lists change.

Four designations that reached crypto businesses directly, each with the official OFAC announcement linked below (all re-verified September 2026):

Sanctions screening means checking identifiers — names, wallet addresses, emails, websites, government ID numbers, countries — against the lists to find out whether a counterparty is designated before you do business with them.

Screening usually runs at several points: when a customer or counterparty is onboarded, when a transaction is about to execute (a withdrawal address, a payment recipient), and on a schedule against stored identifiers, because the lists change all the time. A useful result says which list matched and links to the official source record, so a reviewer can verify the hit instead of trusting a bare yes or no.

Approaches differ in scope. Direct screening answers whether an identifier appears on a list. Blockchain-analytics platforms go further: they cluster addresses and score indirect exposure, such as whether funds have passed through a designated entity. Many businesses use both — fast direct checks inline in the product, and deeper analysis where their risk policy calls for it.

Designations are not permanent. Issuers remove entries when the basis for a listing lapses, when a legal challenge succeeds, or when policy changes, and OFAC publishes removals alongside new designations. For screening, delistings matter as much as listings: blocking a delisted counterparty creates false positives, friction and legal exposure of its own.

That is why screening infrastructure has to track removals, not just additions. CompliAPI keeps delisted entries with their removal date and publishes them, so a match today always reflects the current state of each list.

For engineering and compliance teams comparing tools, a few properties separate infrastructure you can build on from a static list download: