CoinEx, a crypto exchange once popular in Iran, said it was shutting down on Tuesday citing a prolonged downturn in the cryptocurrency market and rising compliance costs.

The exchange, founded by a former Tencent engineer in Hong Kong, was the subject of a Wall Street Journal article in June that showed how it had become a favorite of Iranian users, including ones with ties to the Islamic Republic. CoinEx said it would move to cut off Iranian users following the article.

The U.S. in recent weeks has been trying to economically isolate Iran, which has raised the risks for any bank or crypto platforms that officials might determine are helping the regime evade the restrictions.

Treasury Secretary Scott Bessent in August said the U.S. would scale up its Iran sanctions actions as part of what he called "Operation Economic Outcast." Since then, the Treasury Departemnt has taken steps to cut off foreign banks and placed sanctions on individuals who it said helped Iran evade sanctions or otherwise supported the regime, including through the use of digital assets.

"Companies and foreign countries are getting on board" with the Treasury campaign, a department official said in a statement responding to an inquiry about CoinEx's closure.

"Anyone supporting the Iranian regime, whether in dollars, rials, or crypto, is subject to action by the U.S. government," the official added. "We recommend they take action to cut ties from Iran before we reach them."

The decision to ultimately shut down was years in the making and wasn't the result of its decision to curtail business from Iran, Haipo Yang, CoinEx's founder, said in a message on Tuesday.

Starting in 2019, wallets with an identifiable link to Iran moved more than $3.84 billion through CoinEx, according to blockchain intelligence firm TRM Labs. The exchange was also a destination for illicit crypto acquired by Iran's Central Bank, which investigators traced back to $1.5 billion that North Korean hackers stole from the crypto exchange Bybit, according to the Journal report.

Other wallets transacting with CoinEx were identified as having ties to Iran's Islamic Revolutionary Guard Corps.

At the time, the exchange said it didn't have a relationship with the Iranian government and would review the transactions linking funds to the Bybit hack. The crypto exchange said it was moving to limit its exposure to Iranian users and implement new know-your-customer policies in response to the Journal's report.

In a post explaining the shutdown, CoinEx cited "continuously rising regulatory requirements across major jurisdictions, as well as compliance costs" and other factors.

Some countries have moved to tamp down on the illicit use of crypto, even as the U.S. has struggled to pass legislation that would implement new safeguards while also seeking to allow blockchain technology to play a larger role in the financial industry.

Prices on bitcoin, the world's biggest digital currency, recently traded around $79,000. Even with a rebound in the last two weeks, it is still roughly 37% below its record of more than $126,000 in October 2025.