Israeli prosecutors have charged seven officers from classified military and police units with stealing tens of millions of shekels using cryptocurrency wallets, marking one of the nation's most significant digital asset-related corruption cases. The defendants—now facing bribery, theft by a public servant, money laundering, obstruction of justice, and tax charges—reportedly moved most illicit funds through crypto wallets, with authorities seizing over 50 million shekels ($13 million) in wallets and cash during the investigation.

Reservist Charged over Polymarket bets placed with classified intel

This is not the first time in recent months that Israeli security personnel have been caught using crypto for personal gain.

A reservist and a civilian were charged after allegedly using classified military information to place bets on Polymarket, a crypto-based prediction platform. That case also involved the Shin Bet, the Defence Ministry, and Israel Police, and several additional reservists were arrested during the investigation.

The backdrop to both Israeli cases is a broader global picture in which crypto has become a tool of state-level financial operations. Blockchain analytics firm Chainalysis reported that total illicit crypto transaction volume hit a record $154 billion in 2025, driven by a 694% surge in value moving through sanctioned entities.

Iran and Russia built crypto networks worth hundreds of billions

In 2025, Iran reached more than 7.78 billion in crypto flows. IRGC-owned wallet addresses used half of that amount for Iranian crypto services. These addresses received over $3 billion in total. The year before it was $2 billion, and that figure does not include volumes from UK-registered exchanges Zedcex and Zedxion, which were not sanctioned until January 2026.

Russia launched its own ruble-backed token called A7A5. $93.3 billion was processed under the token in a year. The exchange Grinez was affiliated with the token. It was linked to Garantex

Russia built its own parallel system. A ruble-backed token called A7A5, launched in 2025, processed $93.3 billion in under a year. Its affiliated exchange, Grinex, was the rebrand of a previously sanctioned Russian platform, Garantex. It was shut down in March 2025. $2.2 billion worth of A7A5 were converted into dollar-pegged stablecoins through an instant swap service. It was the way for Russian authorities to enter the global financial system without the need for traditional banking.

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