Iran's $7.8 billion crypto market draws fresh attention

The US-Israeli war on Iran is putting renewed focus on country's $7.8 billion cryptocurrency market, which citizens and authorities there have increasingly turned to for storing and sending money during periods of turmoil.

Analytics firms Chainalysis and Elliptic produced reports this week showing sharp spikes in outflows from Iranian crypto exchanges immediately after air strikes hit the country. The sums were paltry relative to the total market, but suggested that individuals are taking out funds for security, that government entities are doing the same to make payments that skirt sanctions, or some combination of both, experts said.

"What we have been seeing in Iran is both lawful users using crypto as a lifeline amidst geopolitical crisis and a rogue regime using crypto infrastructure for sanctions evasion at scale," said Ari Redbord, global head of policy and government affairs at TRM Labs.


Chainalysis determined that roughly $2.3 million left Iranian crypto exchanges during the peak hour after air strikes began - 873% above the normal average hourly amount.

Funds were routed to overseas platforms, other domestic exchanges and a sizeable share of unidentified "other wallets." Elliptic observed a 700% spike in outflows from Iran's biggest crypto exchange Nobitex immediately after the attacks on Iran.