The United States has sanctioned Iranian exchanges, frozen nearly $1 billion in cryptocurrency, and traced $3.84 billion in Iran-linked flows through a single offshore exchange, exposing the scale of sanctions evasion through digital assets.

The numbers tell the story before the analysis begins. Nearly $1 billion in Iranian cryptocurrency seized by the US Treasury. More than $3.84 billion in Iran-linked flows traced through a single offshore exchange. Iranian crypto outflows of $4.18 billion in a single year. Four domestic Iranian exchanges sanctioned. Executives added to the OFAC list. Central Bank of Iran wallets frozen on the Tron network.

These figures, accumulated over the first half of 2026, describe the largest and most technically sophisticated sanctions enforcement campaign ever conducted through blockchain infrastructure. The US government is not merely identifying Iranian crypto activity. It is actively seizing, freezing, and blocking it at multiple points in the financial chain. The question is whether the campaign is working or whether it is simply documenting the scale of a problem it cannot contain.

The answer is probably both. The United States has developed meaningful new tools for sanctions enforcement on public blockchains, and it is deploying them at unprecedented scale. At the same time, the gap between what investigators can see and what they can stop is wide and growing. Iranian crypto activity grew 70% year over year in 2025 even as US surveillance capabilities expanded. Every enforcement action generates a public record of Iranian evasion methods, which Iranian operators then adapt against. The cat-and-mouse dynamic is running faster than the enforcement side can respond.

Operation Economic Fury

The enforcement campaign has a name: Economic Fury. Treasury Secretary Scott Bessent introduced it on April 14, 2026, as the financial arm of the US response to the military conflict that began with joint US and Israeli strikes on Tehran in February. The campaign targets Iran’s use of cryptocurrency exchanges, wallets, and traditional financial networks that officials accuse of supporting sanctions evasion and military financing.

The campaign followed months of intelligence gathering that began before the military strikes. Treasury officials had been tracking Iranian crypto networks since at least 2024, when Chainalysis and TRM Labs began publishing research on the scale of Iranian stablecoin adoption. The strikes accelerated the timeline from monitoring to action.

The first major crypto action came in April, when Tether froze approximately $344 million in USDT across two Tron wallets after US authorities linked the addresses to Iranian networks. One wallet held about $213 million; the other contained roughly $131 million. Blockchain analysis found transaction patterns associated with wallets linked to Iran’s Islamic Revolutionary Guard Corps and intermediaries connected to the Central Bank of Iran.

In June, Treasury escalated by sanctioning four Iranian cryptocurrency exchanges: Nobitex, Wallex, Bitpin, and Ramzinex. Nobitex, the largest, handles approximately 50% of Iran’s cryptocurrency trading volume according to Chainalysis and claims to serve 11 million users. Treasury also added Nobitex CEO Seyed Ali Khoee and chairman Amir Hossein Rad to the OFAC sanctions list, making them personally subject to asset freezes and travel restrictions.

In July, Treasury froze an additional $131 million in USDT held in four Tron wallets tied to the Central Bank of Iran. Bessent said on X that Treasury remained “committed to disrupting and degrading Iran’s illicit financial activities, including its abuse of digital assets.”

By late July, Bessent disclosed that the cumulative total of cryptocurrency seized or frozen from Iranian sources since the conflict began had approached $1 billion. The figure, while significant, represents assets identified by investigators and does not include Iranian-linked cryptocurrency that moved through compliant exchanges and was not captured in enforcement actions.

The CoinEx connection

While Treasury focused on domestic Iranian exchanges, a parallel investigation exposed the offshore dimension of Iran’s crypto network. On June 24, the Wall Street Journal reported that Iran-linked entities had moved more than $3.84 billion through crypto exchange CoinEx since 2019.

The investigation, citing TRM Labs and public on-chain data, found that CoinEx had become one of the primary routes for moving funds outside US sanctions. More alarmingly, investigators traced activity from two wallets controlled by the Central Bank of Iran and found links to assets stolen from Bybit by North Korean hackers in what was one of the largest thefts in crypto history, involving approximately $1.5 billion in virtual assets.

CoinEx denied any knowledge of Iran-linked activity. The exchange said that on-chain fund flows through a platform do not prove knowledge, support, or participation. It also said it had strengthened Iran-related risk reviews, geo-fencing, sanctions screening, and transaction monitoring. CoinEx has not been subject to new US sanctions as of this writing, but the WSJ report placed it under heightened regulatory scrutiny.

The $3.84 billion figure is notable not just for its size but for its duration. The flows spanned seven years, from 2019 through 2026, covering periods when international attention to Iranian crypto activity was already high. The Financial Action Task Force had placed Iran on its blacklist for most of that period. The fact that billions in Iranian linked flows continued through a single exchange for seven years without triggering enforcement action until journalists reported it raises questions about the gap between blockchain transparency and operational enforcement.

TRM Labs data cited in the WSJ report also showed that CoinEx was not the only offshore exchange processing Iranian flows. Several smaller platforms with limited compliance infrastructure handled significant volumes. The concentration at CoinEx reflects the exchange’s combination of low fees, minimal identity verification requirements during the relevant period, and availability in jurisdictions where Iranian users could access the platform without VPN restrictions.

US-listed spot Bitcoin exchange-traded funds (ETFs) finished July with net inflows, even after a late-month pullback that underscored how cautious investors remained going into August. According to SoSoValue, the funds brought in $172.4 million in net inflows during July—enough to reverse two straight months of outflows.

The month’s positive result was tempered by volatility in the final stretch. On the final Friday of July, spot Bitcoin ETFs logged a $265.4 million net outflow, the largest single-day withdrawal since July 13, suggesting the rebound in demand was not fully sustained.

Key takeaways

• Spot Bitcoin ETFs took in $172.4 million in net inflows in July, reversing two consecutive months of outflows, according to SoSoValue.
• Despite the monthly gain, the last Friday of July saw a $265.4 million net outflow—Bitcoin ETFs’ biggest daily withdrawal since July 13.
• Year-to-date flows remain negative: US spot Bitcoin ETFs have recorded about $5.29 billion in net outflows in 2026.
• Ether ETFs were steadier, ending July with $365.2 million in net inflows and a four-week inflow run, per SoSoValue.
• XRP ETFs also posted continued demand, adding $27.3 million in net inflows in July while recording their fifth positive month of 2026.

Bitcoin ETFs return to inflows—weak finish signals caution

SoSoValue data indicates July’s net inflow improved the outlook for spot Bitcoin ETF investors after a difficult stretch. The article notes that investors pulled nearly $7 billion in aggregate outflows over the previous two months, including what earlier reporting described as the largest monthly outflow of 2026 in June, totaling $4.5 billion (coverage referenced in the original piece: Cointelegraph).

Still, the late-month selling pressure matters for how traders may read positioning. The $265.4 million outflow on the final Friday of July not only flipped daily flows negative, but also marked the largest daily withdrawal since mid-July. In practical terms, that pattern suggests July’s inflows were vulnerable to sudden risk-off behavior—important for anyone tracking ETF flow-driven momentum.

On a broader time frame, weekly flows also turned negative at the end of the month. For the week ending July 31, Bitcoin ETFs recorded a $61.53 million outflow after three consecutive weeks of inflows. That shift reinforces the message that demand improved during parts of July, but participation thinned as the month closed.

Where 2026 stands: cumulative outflows stay elevated

Even with a positive July, the year-to-date picture for US-listed spot Bitcoin ETFs remains firmly in the red. Based on the figures cited from SoSoValue, Bitcoin ETFs have accumulated roughly $5.29 billion in net outflows in 2026.

The monthly distribution shows a market that has not found consistent footing. March, April, and July are the only months reported as positive so far this year, bringing total inflows of $3.46 billion. Meanwhile, the remaining months—January, February, May, and June—accounted for outflows totaling about $8.75 billion.

Despite that imbalance, the products have still attracted meaningful long-term net capital since launch. The article states that US spot Bitcoin ETFs have drawn $51.32 billion in cumulative net inflows, and that total net assets reached $76.29 billion at the end of July.

Ether ETFs keep the momentum going

While Bitcoin ETFs faced renewed selling pressure at the end of July, Ether-related products showed comparatively steadier demand. According to SoSoValue, US spot Ether ETFs ended July with $365.2 million in net inflows and maintained four consecutive weeks of inflows.

That marks a second month of positive flows for Ether ETFs in 2026 after April’s $356 million inflow. Yet, the recovery is not enough to fully erase earlier weakness: despite this improvement, the article notes Ether ETFs are still around $1.1 billion in net outflows year to date.

For investors, the contrast between Bitcoin and Ether flows can be informative. It suggests that even if market-wide sentiment is cautious, some capital has been willing to rotate into Ether exposure—at least at the ETF level—rather than staying entirely risk-off.

XRP ETFs post another positive month

Other altcoin ETF categories also appear to have avoided the same late-month stress seen in Bitcoin. XRP ETFs, in particular, maintained steadier activity. The article reports that XRP ETFs recorded $27.3 million in inflows during July and marked their fifth positive month of 2026.

Year-to-date, XRP ETFs have generated about $343 million in net inflows, positioning them as one of the stronger-performing crypto ETF segments in the market this year, at least based on the net flow figures cited.

In a market where ETF flows can swing quickly with broader macro conditions and crypto price action, continued positive monthly demand for XRP products can serve as a signal that some investors are still finding specific altcoin exposure compelling—even when Bitcoin faces repeated episodes of volatility.

Going forward, traders and long-term holders will likely watch whether Bitcoin ETF demand can withstand similar end-of-month selling pressure, especially since weekly flows flipped negative as July closed. At the same time, the relative stability in Ether and XRP inflows may keep comparing as a useful read on whether the next wave of capital concentrates in Bitcoin or broadens across the rest of the crypto ETF complex.

Trading volume across South Korea’s five major won-based crypto exchanges fell 54.6% year over year in the first half of 2026 as liquidity became increasingly concentrated on market leader Upbit.

South Korea crypto volume drops below $367B

Upbit, Bithumb, Coinone, Korbit and Gopax generated about $366.58 billion in combined trading volume during the first six months of the year, NexBlock reported. That represented a 54.6% decline from the corresponding period in 2025.

The contraction continued in July. From July 1 through July 27, the five exchanges recorded cumulative trading volume of approximately 17.34 trillion won, down 16.9% from the same period in June.

The figures point to weaker activity across South Korea, one of Asia’s most active retail crypto markets. They also show that lower overall volume has not affected all exchanges equally.

Upbit processed about 11.69 trillion won during the July period. Its trading volume fell 10%, but its market share increased from 62.3% to 67.4% as competing platforms suffered steeper declines.

Bithumb recorded approximately 4.71 trillion won in volume. Its share of the five-exchange market dropped from 30.7% to 27.1%, widening the gap between Upbit and Bithumb to 40.3 percentage points.

Upbit gains as liquidity becomes concentrated

NexBlock attributed the changing competitive landscape to liquidity moving toward the largest platforms during the broader market slowdown.

Deep liquidity can attract more traders by supporting larger orders with less price slippage. That advantage can reinforce the position of leading exchanges when overall activity declines, leaving smaller platforms with fewer trades and thinner order books.

Coinone, Korbit and Gopax now face growing pressure to differentiate themselves beyond retail spot trading. According to NexBlock, smaller exchanges are exploring partnerships with securities firms, institutional services and internal restructuring.

Future competition could therefore depend less on headline trading volume and more on stablecoin liquidity, regulatory compliance, institutional access and cooperation with traditional financial companies.

For US investors, South Korean exchange data can provide insight into retail demand in a major Asian market, although the won-based platforms primarily serve domestic users. Reduced Korean volume may weaken one source of global altcoin liquidity and price discovery, particularly for tokens that historically attracted strong local trading interest.

Crypto tax could reshape trading activity in 2027

The volume decline comes as South Korea prepares to implement its long-delayed cryptocurrency tax.

Finance Minister Koo Yun-cheol confirmed on July 29 that the government will begin taxing crypto gains on Jan. 1, 2027, as previously scheduled.

“We are pushing forward with the plan to tax cryptocurrency starting next year as scheduled,” Koo said.

Income generated by transferring or lending virtual assets will be classified as other income. Annual gains exceeding 2.5 million won, or about $1,740, will face a 20% national tax, while a local income tax will raise the combined rate to 22%.

Investors who remain below the annual threshold will not owe tax under the framework. Taxpayers are expected to file their first returns in May 2028 for gains earned during 2027.

The policy creates an additional consideration for domestic traders after three previous delays. Its effect on exchange volume will depend partly on how platforms implement transaction reporting and cost-basis calculations before the rules take effect.

Smaller exchanges seek new sources of growth

South Korea is simultaneously expanding state-backed investment in strategic industries, though the initiative is separate from its crypto tax and exchange policies.

The government approved plans for a new account under the Korea Investment Corporation, the country’s sovereign wealth fund. The account will begin with at least 20 trillion won, or approximately $13.7 billion, and may invest domestically in artificial intelligence, data centers and other strategic sectors.

KIC has historically focused on overseas assets. The expanded mandate reflects a wider effort to direct institutional capital toward domestic industries while seeking long-term returns.

For crypto exchanges, the immediate challenge remains rebuilding activity while complying with tighter rules. Upbit’s rising market share suggests smaller platforms may need institutional partnerships, stablecoin services, or structural changes to compete in a market where total trading volume continues to fall.

New York Attorney General Letitia James has sued prediction markets platform Kalshi for violating state laws against illegal gambling by offering users event contracts on elections, sporting events, and other outcomes.

Kalshi has called the lawsuit “political theater,” while the Commodity Futures Trading Commission (CFTC) has accused the state of trying to “annihilate prediction markets.”

New York Files Lawsuit Against Kalshi

The lawsuit alleges Kalshi operates an illegal gambling operation in New York and asks Kalshi to stop operating in the state, forfeit its illegal gains, pay restitution to users, and pay civil penalties up to three times its gains. James alleges that Kalshi has not obtained a New York State Gaming Commission license to operate in the state.

New York had filed similar lawsuits against Coinbase and Gemini’s prediction market platforms. James said in a statement released Friday:

“New York’s gambling laws protect children from underage betting and help combat gambling addiction. No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple. We are taking them to court to uphold our laws and protect New Yorkers.”

The latest action comes after the New York State Gaming Commission issued a cease-and-desist order against Kalshi in October 2025. Kalshi responded by suing the regulator in court. However, a judge rejected Kalshi’s request for a preliminary injunction, and the appeals court rejected a subsequent bid to block enforcement action during the appeals process.

Elisabeth Diana, Kalshi’s head of communications, called the action “political theater,” saying:

“It’s sad to see this type of political theater from the leadership in our own state. States can’t just shut down a federally licensed exchange. This would also hurt New Yorkers, who would be driven offshore. We love New York, we love New Yorkers, and New Yorkers love our product.”

The prediction market platform wants to move the lawsuit to Manhattan federal court, stating that it is based in New York. According to court filings, damages and costs could amount to $36 billion, significantly higher than Kalshi’s $22 billion valuation.

CFTC Files Emergency Motion

Prediction markets have gained immense popularity since the 2024 US Presidential elections, and the Commodity Futures Trading Commission (CFTC) has claimed exclusive regulatory oversight over them. The commission has also challenged regulatory attempts by other agencies in nine jurisdictions, including New York.

The regulator filed an emergency motion to block any enforcement action by New York, arguing that it oversteps authority and infringes upon the CFTC’s exclusive authority to regulate contract markets like Kalshi and other prediction market platforms, and threatens to annihilate the industry nationwide.

Kalshi added that by attempting to shut down the platform, New York was subverting the CFTC’s exclusive jurisdiction to regulate prediction market platforms:

“New York seeks to place itself in the position of a nationwide derivatives regulator. Through this action, which seeks to shut Kalshi down nationwide, New York seeks to fundamentally subvert the exclusive jurisdiction of the CFTC.”

Why Does New York See Prediction Markets As Gambling

New York equates Kalshi’s prediction markets with gambling because it allows people to wager on events whose outcomes they do not control. This includes wagering on outcomes like “who wins the Super Bowl” and even reality TV shows.

The state also highlighted that the minimum age under state law for mobile sports betting was 21 and opposed Kalshi allowing 18- to 20-year-olds on its prediction market platform.

New York Governor Kathy Hochul stated:

“Kalshi has chosen to ignore New York’s gaming laws, which exist to protect consumers, prevent problematic gambling, deliver funding for critical public services, and ensure that every company plays by the same rules. This choice has consequences.”

Prediction Markets Gaining Popularity

Despite regulatory scrutiny, prediction markets like Kalshi and Polymarket are gaining significant traction. Kalshi has expanded its blockchain-based infrastructure and launched tokenized prediction markets on Solana. It subsequently added support for multiple blockchain networks.

Prediction markets have also grown beyond sports, allowing users to trade event contracts on real-world outcomes like elections, inflation, interest rate cuts or hikes, entertainment, and even daily temperatures.

The popularity of prediction markets surged during the recently concluded FIFA World Cup 2026. According to Chainalysis, prediction markets processed around $20 billion in trading linked to the sporting event.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Moneyflip CEO Marcos Arturo Kleiman Tronllan faces a federal murder-for-hire charge after allegedly paying undercover agents $40,000 to kidnap and kill a businessman over an unpaid debt.

Moneyflip CEO arrested in Miami

Homeland Security Investigations agents arrested Kleiman in Miami on July 30 in connection with a federal complaint filed in San Diego.

Kleiman, 40, is a Mexican citizen and lawful permanent resident of the United States. He previously lived and worked in San Diego, according to the U.S. Attorney’s Office for the Southern District of California.

Moneyflip is a registered money services business offering cross-border currency exchange services. Kleiman previously operated the company as MXN Financial LLC before it changed its name to Moneyflip LLC in 2025.

Investigators began examining Kleiman while investigating currency exchange businesses in San Diego and Imperial counties. Authorities suspected that he used cross-border transactions to avoid Bank Secrecy Act reporting requirements and launder proceeds from drug sales.

The complaint contains allegations rather than proven facts. Kleiman is presumed innocent unless convicted.

Undercover agents converted $750K into crypto

Undercover HSI agents approached Kleiman in February and asked him to convert U.S. dollars into cryptocurrency. The agents allegedly told him that the money came from drug sales.

Prosecutors said Kleiman created an email account and shared its password with the agents. The parties allegedly communicated through unsent draft emails to avoid transmitting messages directly.

Kleiman then allegedly converted approximately $750,000 into cryptocurrency and arranged for the assets to be transferred to an undercover agent’s wallet. Authorities said he charged a 10% fee.

“Kleiman converted approximately $750,000 of United States currency into cryptocurrency and caused the transmission of those crypto coins into an undercover federal agent’s wallet,” prosecutors said.

During those discussions, Kleiman allegedly asked whether the agents could recover a debt from a Mexican businessman and kill him. Prosecutors said he agreed to pay $40,000 for the kidnapping and murder, including two $5,000 advance deposits.

Agents staged murder before 25,000 USDT payment

Kleiman allegedly arranged for a third party to deliver the first $5,000 deposit to an undercover agent in San Diego in May. Prosecutors said he later paid another $5,000 deposit after an agent requested money to reserve the purported killers.

On July 28, the undercover agents showed Kleiman three photographs and a video that falsely depicted the businessman as having been captured, tortured and killed. No murder occurred as part of the operation.

Authorities said Kleiman responded that the agents could count on him to complete the payment. On July 29, he allegedly delivered another $5,000 in cash and transferred approximately 25,000 USDT to an undercover cryptocurrency wallet.

USDT is a dollar-pegged stablecoin issued by Tether. Unlike cash, transfers made through public blockchain networks can leave transaction records that investigators may use alongside messages, surveillance, and other financial evidence.

Federal charge carries a 10-year maximum sentence

Kleiman faces one count of murder-for-hire under Title 18, Section 1958(a) of the U.S. Code. The charge carries a maximum sentence of 10 years in federal prison and a fine of up to $250,000.

The case is being prosecuted by Assistant U.S. Attorneys Michael Deshong and Christopher Beeler. HSI led the investigation with support from the U.S. Postal Inspection Service, Drug Enforcement Administration, Customs and Border Protection, IRS Criminal Investigation, and local law enforcement agencies.

Money services businesses that exchange or transmit convertible virtual currencies may fall under federal Bank Secrecy Act requirements. Registration as a money services business does not represent government approval of a company or its activities.

A Hong Kong woman reportedly lost around $3.3 million after an online romantic partner directed her to a fraudulent cryptocurrency investment platform.

Crypto romance scams cost victims nearly $9M

Hong Kong authorities recorded 25 investment fraud cases involving online romantic relationships during the week ending July 30, according to police statistics cited by Binance Square News.

The reported losses totaled nearly HK$70 million, or roughly $9 million. One case accounted for more than a third of that amount.

A 50-year-old insurance professional reportedly met a person online who presented himself as a car dealer. After establishing a romantic relationship, the person persuaded her to invest in virtual currencies through an unfamiliar platform.

The victim continued transferring money after the platform displayed rising account balances. By last month, it claimed that her portfolio had generated returns exceeding 800%.

However, the platform denied her withdrawal request. The purported romantic partner and an alleged investment adviser then stopped responding, leaving the woman with cumulative losses exceeding HK$26 million or around $3.3 million.

Authorities did not disclose which cryptocurrencies were involved or whether any of the transferred funds had been recovered.

Fake profits kept the victim investing

The case follows a common pattern in relationship-based cryptocurrency fraud. Scammers first build trust through dating applications, social media or messaging services before introducing an investment opportunity.

Victims are then directed to trading websites or applications controlled by the fraudsters. These platforms may display fabricated profits, allow a small initial withdrawal, or encourage victims to increase their deposits.

The scheme typically becomes apparent when a victim attempts to withdraw a larger amount. Operators may block the transaction or demand additional payments described as taxes, processing charges or penalties.

Hong Kong police urged investors to treat investment recommendations from newly established online contacts with caution. Warning signs include guaranteed returns, unusually high profits and requests to transfer funds through an unfamiliar platform.

The FBI describes the same method, saying criminals control the supposed investments and often steal all funds deposited by victims.

Hong Kong employment scams also surged

The romance cases add to a wider increase in online fraud affecting Hong Kong residents.

Police recorded 2,148 online employment scams between January and May 2025, up 92.1% from the same period a year earlier, according to figures reported by the South China Morning Post and HRD Asia.

Reported losses increased from HK$260 million to HK$480 million, an 89% rise. Authorities registered 621 cases in May alone, with 60% originating on WhatsApp and another 22% on Telegram.

Investigators attributed much of the increase to “click farming” schemes. Fraudsters initially pay participants small commissions for completing simple online tasks, such as following social media accounts or purchasing products to inflate a seller’s activity.

After gaining trust, scammers ask victims to commit larger sums for higher-paying assignments. Withdrawal attempts are then rejected, with operators claiming the victim made an error or damaged a company system and must pay a penalty.

US crypto fraud losses reached $7.2B

Similar investment schemes remain a major threat to US users. Cryptocurrency investment fraud produced $7.2 billion in reported US losses during 2025, making it the country’s largest category of financial loss reported to the FBI’s Internet Crime Complaint Center.

The FBI’s 2025 report said scammers commonly approach victims through social media, dating platforms and unsolicited messages before moving conversations to private messaging services.

US authorities advise victims to stop sending money immediately and preserve wallet addresses, transaction hashes, platform domains and communications. The FBI also warns against paying supposed recovery services, which may operate a second scam targeting people who have already lost funds.

Hong Kong police similarly advised users not to lower their financial safeguards because of emotional attachment or trust. Investors should independently verify platforms and avoid offers promising guaranteed or abnormally high returns.