Iran Faces Crypto Setbacks: 11% Drop in Flows Due to Global Tensions

TLDR

• Iranian crypto flows dropped by 11% in 2025, reaching $3.7 billion between January and July.
• The decline was driven by a breakdown in nuclear negotiations with Israel and rising tensions.
• The $90 million Nobitex hack in June significantly disrupted Iran’s crypto transaction volumes.
• The hack led to liquidity issues, slowing transaction processing on Iran’s largest crypto exchange.
• Tether froze 42 Iranian-linked crypto addresses in July, marking its largest freeze of Iranian funds.
• Many Iranians moved funds to Dai on the Polygon network after the Tether freeze.

Crypto flows into Iranian platforms fell by 11% in 2025, according to blockchain analytics firm TRM Labs. The decline resulted from a breakdown in nuclear talks with Israel, an armed conflict, and a major hack. TRM Labs reported that Iranian crypto transactions dropped to $3.7 billion between January and July.

The decrease was most pronounced in June and July. The firm attributes the downturn to multiple factors, including power outages, Israeli cyberattacks, and the Nobitex hack. Iranian crypto transactions also saw a significant drop after the Israeli conflict that began on June 13.

Iran’s Crypto Platforms Face Strain After Nobitex Hack

Nobitex, Iran’s largest crypto exchange, experienced a $90 million hack in June, affecting 87% of the country’s crypto transactions. This security breach disrupted liquidity and slowed transaction processing, forcing users to seek alternative platforms. The hack was attributed to the pro-Israel group, Predatory Sparrow, which targeted Nobitex amid rising tensions with Israel.

As a result, the Nobitex breach undermined trust in Iran’s crypto exchanges, which many Iranians rely on for financial stability. The hack worsened as users experienced delayed services, driving them toward foreign exchanges with less stringent checks. TRM Labs highlighted the significant shift in crypto transaction volume as a result of this event.

Tether Freezes Iranian Crypto Addresses Amid Rising Tensions

Tether, a leading stablecoin issuer, froze 42 Iranian-linked crypto addresses in early July. The freeze was the largest ever recorded by Tether and took place after rising tensions between Iran and Israel. TRM Labs stated that the blacklisting intensified Iranian users’ efforts to offload USDT balances.

This push led Iranian crypto users to shift funds into Dai, a stablecoin on the Polygon network, known for its minimal restrictions. Despite the freeze, Iran’s reliance on stablecoins like USDT and Dai for value storage remains strong. These cryptocurrencies offer Iranians a hedge against the country’s soaring inflation.

Iran’s Continued Use of Crypto for Sanctions Evasion

Despite the challenges faced by Iranian crypto exchanges, the country remains heavily reliant on crypto to bypass international sanctions. Iran continues to use cryptocurrencies for purchasing goods like AI hardware and drone components from China. TRM Labs also notes that crypto funds have been used to finance espionage activities.

Though these transactions are illicit, they account for less than 1% of total Iranian crypto volume. The use of cryptocurrencies for sanctions evasion and sensitive transactions remains integral to Iran’s ability to operate in the global economy.

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