The source of the Iranian cryptocurrency saw a significant increase in crypto outflows on Saturday, within minutes of the start of the US and Israeli attacks on Tehran. However, widespread internet outages have prevented further outflows.
In a post on Monday, Elliptic said crypto outflows from the Nobitex exchange surged more than 700% to more than $500,000 in the minutes after the first airstrikes, and a chart shows that outflows reached nearly $3 million an hour later that day.
Elliptic said the sharp increase in outflows “represents potential capital flight from Iran” and its initial tracking shows that many of these funds have been sent to foreign crypto exchanges.
“This allows funds to leave Iran while avoiding some of the scrutiny of the global banking system,” Elliptic said.
However, the outflow of cryptos from Nobitex fell sharply after Saturday, which crypto platform TRM Labs attributed to the Iranian regime imposing a strict internet shutdown.
Internet connectivity in Iran has reportedly dropped by nearly 99% since the conflict broke out, TRM noted.
TRM also disputed Elliptic’s conclusion that capital flight is leaving Iran, saying:
“The country’s crypto ecosystem appears to be showing no signs of acceleration or capital flight, but instead is experiencing both transactions and volume declines as the regime imposes strict internet shutdowns.”
The crypto exodus comes at a time when the US and Israel want to topple the current Iranian regime and destroy its nuclear and missile programs. Iran responded with its airstrikes on neighboring countries, which created more instability in the region.
Nobitex is Iran’s largest crypto exchange, handling about 87% of the country’s crypto trading volume. In 2025, it will have processed around $7.2 billion for over 11 million users.
Millions of Iranians were affected by the recent banking collapse
Iranians rely on crypto to store and transfer money as a solution to navigating Iran’s fragile banking system and the extensive sanctions imposed on the country.
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In October, one of Iran’s largest private banks, Ayandeh Bank, went bankrupt after accumulating $5.1 billion in losses and nearly $3 billion in loans, affecting more than 42 million customers.
The Central Bank of Iran warned last year that eight other local banks are at risk of collapse if the reforms are completed.
Iran’s crypto exchanges have not been without their problems either, as Nobitex was hacked for $81 million in June.
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