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Just 12 hours before the United States and Israel began attacking Iran in late February, Firouz, a crypto user in Tehran, decided to act. “I was feeling all week the war would start soon,” he said.

Trusting his instincts, he moved all his crypto savings out of Nobitex – Iran’s largest digital asset platform and the central hub of the sanctions-hit country’s crypto ecosystem – to his personal digital wallet. “My main thinking was that I could potentially be forfeiting true ownership of any money left in a state-linked or state-monitored Iranian crypto service in the event of war, whether through an action taken by state authorities or as a consequence of cyberattacks,” he said.

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Iran’s crypto ecosystem was valued at more than $7.78bn last year, growing at a faster pace compared with 2024, according to crypto transaction monitoring firm Chainalysis. But the data suggests it is not just Iranian citizens who have turned to crypto in a bid to offset the impact of rampant inflation and a weakening currency.

The Islamic Revolutionary Guard Corps (IRGC) accounted for about 50 percent of on-chain activity in the fourth quarter, mirroring its dominance in the country’s economy. Harder to trace and easier to transfer than traditional bank payments, crypto offers a way to sell oil, buy weapons and commodities, circumventing sanctions. And it has also been a method of payment for imports of goods.

Yet Iran’s turn to crypto has also set off a new cat-and-mouse race with the US, with Washington trying to strangle Tehran’s economic options, already limited because of decades of sanctions.

‘Target all financial lifelines’

In early April, Iranian authorities said they would ask oil ships seeking passage through the Strait of Hormuz to pay a toll in cryptocurrency. Reports have emerged of Iran already receiving a number of payments in crypto for ships transiting through the strait.

“It is common for jurisdictions subject to heavy sanctions to naturally gravitate toward cryptocurrency because it provides alternative rail that gives access to finance they are otherwise restricted by sanctions,” said Kaitlin Martin, a senior intelligence analyst at Chainalysis. The estimate that the IRGC hold about half of crypto activities likely reflects a fraction of the true extent of authority-controlled wallets, since many have not yet been identified by regulatory bodies, Martin said.

But earlier this week, the US announced sanctions on a network of Iran-linked crypto wallets, freezing $344m in digital assets, as the Trump administration tries to increase economic pressure on Iran amid negotiations to end their war. “We will follow the money that Tehran is desperately attempting to move outside of the country and target all financial lifelines tied to the regime,” said US Treasury Secretary Scott Bessent on X.

Iran’s economy has for decades operated under a heavy sanctions regime that has barred Iranians from accessing the international financial system. This has helped create a vibrant local cryptocurrency ecosystem that is being used as an alternative channel to bypass economic restrictions.

For Iranians crypto offers a way to hold and preserve the value of their salaries and savings. Keeping their income and savings within the state-controlled financial system would risk losing their hard-earned money to galloping inflation and the collapse of the rial, which has lost about 90 percent of its value since 2018.

But for the past years, it has become harder for the average Iranian to navigate the crypto sphere, too, as IRGC-affiliated entities have taken over crypto mining operations, driving others out and using crypto to evade sanctions.

“By using subsidised electricity, the IRGC engages in crypto mining and is effectively converting energy into non-sanctionable money,” a Tehran-based cryptocurrency and blockchain researcher said, adding that state-linked ransomware operations are also used to generate revenue.

Against that backdrop, the US enforcement agency, Office of Foreign Assets Control (OFAC), classified Iran’s entire crypto ecosystem as high-risk.

“As a result, ordinary people’s connections with international businesses and crypto communities have been almost entirely cut off. Major exchanges freeze Iranian accounts, foreign companies avoid working with counterparts inside the country, and prominent experts with relevant knowledge are unwilling to share that knowledge with Iranians,” the source said. “This is the cost ordinary people are forced to bear.”

On top of that, internet shutdowns – since the start of the war, Iranian authorities have imposed strict internet restrictions – lack of trust towards state-linked entities and cyberattacks have made it more difficult to trade in cryptocurrencies.

What happens when war happens?

Still, two years of successive shocks, including two wars and nationwide protests, have led to a spike in crypto activity. Between February 28 – when joint US-Israel strikes hit Iran – and March 2, monitoring crypto groups detected about $10.3m in cryptoasset outflow, a separate Chainalysis report said. A number of digital wallets used during this surge in cryptocurrency activity were linked to the IRGC.

“Some of the wallets that withdrew funds during the spike have historical upstream or downstream exposure to wallets that have been identified as belonging to the IRGC or services processing IRGC funds, indicating that at least a portion of the activity following the strikes could represent Iranian state movement of funds,” read the report.

Before Israel’s 12-day war in June 2025, crypto crime monitoring group TRM Labs identified a more than 150 percent spike in outflows from Nobitex.

The platform has more than 11 million users and allows Iranians to swap rials for cryptocurrencies, which can then be transferred to digital wallets. In practice, this makes it easier to move money out of Iran while bypassing some of the checks and oversight associated with the global banking system. Within minutes of the first US-Israeli attack last June, outgoing transaction volumes from Nobitex surged by 700 percent, said Elliptic, a blockchain analytics firm.

On June 18, $90m in cryptoassets stored in Nobitex were stolen in a cyberattack widely attributed to the Israel-linked group Predatory Sparrow. The group destroyed the stolen cryptoassets by sending them to a wallet with no known private keys.

Highlighting the importance of cryptocurrency in the Iranian economy, the Central Bank of Iran bought last year more than $500m in USDT, the US dollar-backed stablecoin, according to a January report by Elliptic. That, read the report, indicated “a sophisticated strategy to bypass the global banking system”.

But the US is trying to keep up, too. Before freezing hundreds of millions in cryptocurrency on Wednesday, OFAC in January sanctioned two UK-registered companies, Zedcex and Zedxion, that were operating as unauthorised crypto exchanges. They were accused of involvement in facilitating financial activity that allowed Iran to evade sanctions, Elliptic said.

According to Martin, there will be more of these actions as regulators in the public sector in the US and beyond “are coming to understand” that cryptocurrencies are being used “at scale”.

The US president has railed against Iran’s proposal on Truth Social as uncertainty over the fragile ceasefire grows.

United States President Donald Trump has warned Iran must “get smart soon” following a proposal from Iran that would postpone a deal on Iran’s nuclear programme.

“Iran can’t get their act together,” Trump wrote on his Truth Social platform on Wednesday. “They don’t know how to sign a nonnuclear deal. They better get smart soon!”

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The president included an AI-generated photo of himself carrying an assault rifle, with bombs exploding on a mountainside behind him. A banner over the image read: “NO MORE MR. NICE GUY!”

The latest threats came as uncertainty surrounding the fragile US-Iran ceasefire grows, days after the president called off the latest round of talks with Tehran.

Although Washington said it was reviewing Tehran’s proposal, it reportedly received a lukewarm response, with the White House emphasising Trump would “not be rushed into making a bad deal” and that “Iran can never possess a nuclear weapon”.

‘Intense competition’

Rob Geist Pinfold, a lecturer in international security at King’s College London, told Al Jazeera that “we’ve gone past the stage … for a physical war”, but that both Tehran and Trump were in a stage of “intense competition”.

“Both sides are basically trying to signal to the other that they have more resilience, that time is on their side,” Pinfold said.

Tehran’s proposal is “deferring all of the difficult issues until later” by prioritising the end of the war and reopening the Strait of Hormuz.

“[But the tactic] simply doesn’t work for the Americans because they feel like if they give up on basically the leverage they have – the physical force leverage – the war could resume,” Pinfold added.

Meanwhile, Washington has claimed to have imposed additional financial pressure on Tehran.

In a post on X late on Tuesday, US Treasury Secretary Scott Bessent said his department has “targeted Iran’s international shadow banking infrastructure, access to crypto, shadow fleet, and weapons procurement networks”.

Last week, the Treasury sanctioned an independent Chinese oil refinery for buying hundreds of millions of dollars worth of Iranian oil, along with 40 shipping firms and vessels alleged to be operating as part of Iran’s shadow fleet.

Bessent claimed such actions “have disrupted tens of billions of dollars in revenue” and had helped to “rapidly” depreciate Iranian currency.

On Wednesday, the Iranian rial dropped to a new record low against the US dollar, losing about 6 percent of its value since the war began.

According to currency-tracking websites Bonbast and AlanChand, the rial was trading at about 1.8 million rials against the dollar on the black market.

When the war began at the end of February, the dollar traded at about 1.7 million rials.

Iran executes, jails protesters

As talks stall, Iranian authorities have stepped up efforts to prosecute protesters and dissidents.

United Nations human rights chief Volker Turk said on Wednesday that at least 21 people have been executed and more than 4,000 arrested since the start of the war on Iran.

Nine people were executed in relation to Iran’s mass January protests, 10 for alleged membership in opposition groups and two on espionage charges, the office said.

“I am appalled that – on top of the already severe impacts of the conflict – the rights of the Iranian people continue to be stripped from them by the authorities, in harsh and brutal ways,” Turk said.

According to the UN, many of the 4,000 people arrested have disappeared, been tortured, or subjected to other forms of illegal punishment.

Iran’s newly enhanced espionage law allows authorities to execute and seize the property of people accused of a wide range of activities related to “hostile states and groups”.

The world’s militaries spent $2.88 trillion in 2025, an increase of 2.9 percent from the year before, according to the Stockholm International Peace Research Institute’s (SIPRI) latest report.

To put that number into perspective, $2.88 trillion amounts to $350 of military spending for each person on the planet.

In this visual explainer, Al Jazeera unpacks the rise of global militarisation, including how much each nation spends, which countries sell the most weapons, and how military spending compares with spending on healthcare and education.

The US again tops the list in military spending

In 2025, the five biggest military spenders were the United States ($954bn), China ($336bn), Russia ($190bn), Germany ($114bn) and India ($92bn), accounting for more than half (58 percent) of world military spending.

The US is by far the biggest spender, as it has been every year since World War II. The $954bn spent by the US is more than the next six countries combined.

Since 1949, the US has spent at least $53.5 trillion on its military, accounting for more than half (51.5 percent) of the global total of more than $100 trillion.

Military spending has generally followed the predictable pattern of rising during wartime and falling during more peaceful periods.

The chart below shows the total global military spending over the past 75 years.

Post-World War II, global military spending surged rapidly in the early 1950s, jumping from $284bn in 1950 to $788bn by 1953, largely reflecting the impact of the Korean War. Through the late 1950s and early 1960s, spending stabilised at about $700-800bn per year, indicating a sustained but controlled buildup during the early phase of the Cold War.

This was followed by a sharp increase in the late 1960s, when spending crossed $1 trillion for the first time. This jump was driven largely by the Vietnam War and intensified superpower rivalry and arms race between the US and the Soviet Union, which saw a peak of $1.7 trillion by 1988. The end of the Cold War saw military spending fall globally back down to $1.4 trillion by 1991.

Following the September 11, 2001 attacks, US military spending increased once more. Long US-led wars in Afghanistan and Iraq saw global spending exceed $2 trillion for the first time in 2009.

In the past decade, global military spending has again been on the incline, with the 2014 Russian annexation of Crimea marking an inflection point, when NATO members set a target of spending 2 percent of their gross domestic product (GDP) on defence. Since 2016, military spending in Europe has doubled, with Eastern Europe seeing a 173 percent increase, the highest of any other subregion in the world.

And, 2025 marks the highest levels of military spending in history, increasing to $2.88 trillion from $1.69 trillion in 2016 – a rise of 41 percent.

Which countries are arming most rapidly?

Not all countries are arming at the same pace.

A small group spends between $2,000-$5,000 per capita, while most of the world remains below $100-$500.

In dollar terms per capita, Qatar spends the most on its military, growing from $1,231 per capita in 2006 to $5,428 by 2022, an increase of 340 percent.

Israel follows, rising from $1,360 to $5,108 per capita, an increase of 276 percent. Norway is third, up 181 percent from $1,080 to $3,040.

As a percentage, Ukraine shows the largest rise at 3,387 percent, from $63 per capita in 2006 to $2,197 in 2025, reflecting its ongoing conflict with Russia.

The chart below shows the 10 highest increases in spending over the past 20 years.

Who sells most of the world’s weapons?

The trade of global arms is dominated by a select few countries, which often have strong military-industrial complexes.

Between 2016 and 2025, $295bn worth of weapons were sold worldwide.

Other than spending the most on its own military, the US is also the largest exporter of weapons in the world, making up 39 percent ($115bn) of the total global share. A large part of Washington’s dominance is driven by its foreign policy plans, the relationship between the defence industry and the government, and the level of innovation in the industry.

Between 2020 and 2024, private firms received $2.4 trillion in Pentagon contracts – more than half of the department’s discretionary spending, according to the Quincy Institute for Responsible Statecraft and Costs of War at Brown University’s Watson School of International and Public Affairs last year. A third ($771bn) of those contracts went to just five companies: Lockheed Martin, RTX, Boeing, General Dynamics and Northrop Grumman.

The second largest arms exporter is Russia, accounting for 13 percent ($40bn) of global share, followed by France – 9.3 percent ($28bn), followed by China – 5.5 percent ($16bn), and Germany – 5.5 percent ($16bn).

How does military spending compare with healthcare and education?

When a country is asked to spend more on defence, that money has to come from somewhere.

Unless governments expand their budgets or raise new revenue, increased military spending can strain other sectors that people rely on every day – like healthcare and education.

Across 137 countries analysed by Al Jazeera, we classified each country by which sector it spends most on as a function of GDP – healthcare, education, or the military:

• 114 countries spend the most on healthcare
• 14 countries spend the most on education
• 9 countries spend the most on the military

The table below highlights these results. Click on the category names to sort the values from highest to lowest or use the search box to find a specific country.

What’s changing in modern militarisation?

The traditional military is changing.

While the 20th century was defined by mass mobilisation, heavy armour and air power, today’s defence is fusing those with artificial intelligence, autonomous systems and digital warfare infrastructure, often combining classic defence contractors with cutting-edge tech companies.

Recent technological shifts have advanced because of the information age, which has also allowed the proliferation of drones and AI-assisted targeting and surveillance, cyber-warfare capabilities, precision-guided weapons and nuclear modernisation programmes.

For example, the US Department of Defense and the Pentagon are consistently folding privately-developed software systems into their war apparatus.

In summer last year, the Department of Defense awarded OpenAI a $200m contract to implement generative AI into the US military, alongside $200m contracts for xAI and Anthropic. Palantir’s AI-assisted targeting has been used by the likes of the Israeli government during its genocidal war on Gaza.

It is unclear whether football officials from Iran were issued Canadian visas to attend AFC and FIFA congresses.

Representatives from Iran’s football federation were not present at the largest formal meeting of Asia’s football leaders before the World Cup.

In the presence of FIFA President Gianni Infantino, there was no discussion at the Asian Football Confederation (AFC) Congress about Iran’s participation in the tournament or whether the team’s games should be moved out of the United States because of the US-Israeli war on Iran.

Concerns were raised that visa issues could affect the Iranian delegation’s ability to travel to both the confederation meeting in Vancouver and the overall FIFA Congress on Thursday, as well as the World Cup starting on June 11.

The 48-team tournament is being hosted by the US, Canada and Mexico.

It was not clear if visa issues prevented Iranian representatives from attending the AFC Congress. However, as the nine AFC teams that qualified for the World Cup were presented with commemorative gifts, it was announced that Iran would receive their token “once they arrive”.

An Iranian government spokesperson said last week that the national team was preparing for “proud and successful participation” in its World Cup games in the United States.

FIFA, football’s international governing body, has consistently said Iran will stick to the World Cup game schedule decided last December, before the US and Israel launched military attacks on Iran on February 28, and has refused to entertain suggestions that the team’s games be moved to Mexico.

“Now even more, now that the world is going through a very, very delicate, difficult, dangerous time with many conflicts, and many of you are directly affected and involved in these conflicts,” Infantino told the AFC leaders.

“Now even more, we need to find ways to build these famous bridges, or maybe to build football fields instead. And to build competitions where people can join and come together.”

Iran are placed in Group G with Belgium, New Zealand and Egypt.

Team Melli’s planned training camp would be in Tucson, Arizona, and they are scheduled to open their World Cup campaign on June 15 against New Zealand in Inglewood, California, near Los Angeles.

Iran will play Belgium in Inglewood on June 21 before facing Egypt in the final group match in Seattle on June 26.