Iran’s Crypto Sector Suffers 11% Decline Following $90-M Exchange Hack

According to reports, Iran’s on-chain crypto activity fell sharply in the first half of ￰0￱ totaled $3.7 billion in the first seven months, a 10% drop from the same period in ￰1￱ slump accelerated after April: June flows contracted 50% year-on-year and July tumbled 75%. Major Exchange Breach Shakes Trust Based on a TRM Labs report , a major security breach hit Nobitex on June ￰2￱ $90 million was taken from hot wallets, source code was leaked, and some stolen coins were steered to vanity addresses that referenced the Islamic Revolutionary Guard ￰3￱ from the exchange spiked — more than 150% in the week before the fighting — as traders moved funds to what they saw as safer places.

Trust, already fragile, was seriously ￰4￱ Transactions Collapse As Users Withdraw Nobitex’s inbound transfers dropped by about 70% year-on-year after the ￰5￱ dormant Bitcoin wallets tied to mining activity were activated and later routed funds into a newly created hot ￰6￱ responded by imposing overnight trading curbs designed to slow panic, but many users had already pulled funds ￰7￱ show a surge in transfers to foreign platforms and payment processors that have lighter identity ￰8￱ Freezes Strain Liquidity In July, Tether froze 42 wallets linked to Iran, removing a large chunk of usable stablecoin liquidity on local ￰9￱ than half of those wallets had ties, on-chain, to Nobitex or addresses flagged with IRGC links, though ownership remains ￰10￱ also froze $27 million in USDT tied to Garantex , a sanctioned Russian exchange, an action that highlights the broad reach of compliance ￰11￱ US Treasury blacklisted Garantex in 2022, and that prior action has had echoing effects on market ￰12￱ Cuts And Conflict Worsen Market Stress The decline in flows came during a period of heightened regional tension.

A 12-day conflict with Israel erupted in mid-June while nuclear talks ￰13￱ strikes and internal disruptions led to widespread electricity ￰14￱ rigs were ￰15￱ became ￰16￱ many traders, the safest option was to move funds off domestic rails; for others it was to switch stablecoins or ￰17￱ Taxes Tighten The Grip In August, Iran approved the Law on Taxation of Speculation and ￰18￱ law brings capital gains taxes to crypto, gold, real estate, and ￰19￱ will roll out in stages, but officials say oversight will ￰20￱ policy move, combined with freezes and hacks, gives firms more reason to pause or shift ￰21￱ image from Getty Images, chart from TradingView