US Treasury Blocks Major Crypto Exchange MEXC Over Sanctions Evasion

U.S. Treasury Blocks Major Crypto Exchange MEXC from Financial System

The U.S. Treasury Department has formally blocked the major virtual asset exchange MEXC from the American financial system, citing its role in facilitating transactions for sanctioned entities in North Korea, Iran, and Russia. The action, which prohibits U.S. financial institutions from processing any transactions to or from the exchange, was announced by the Treasury’s Financial Crimes Enforcement Network (FinCEN) on June 6, VOA Korean reported.

Treasury Exposes MEXC’s Delayed Sanctions Handling

The Treasury’s order alleges MEXC processed illegal financial transactions linked to sanctions evasion and cybercrime. A central piece of evidence involves a 2025 transaction where the exchange enabled the receipt of approximately $350,000 by Sim Hyun-sub, a North Korean financial intermediary who has been under U.S. sanctions since April 2023. FinCEN highlighted that MEXC processed this payment over two years after Sim’s virtual asset addresses were specifically designated by the Treasury’s Office of Foreign Assets Control (OFAC).

Sim is identified by the U.S. as a representative of the Korea Kwangson Bank, a North Korean financial institution. He is alleged to have been involved in managing virtual asset money laundering, overseeing income from overseas IT laborers, and making payments for the purchase of cigarettes and communication equipment on behalf of the North Korean regime.

Beyond North Korea, FinCEN stated MEXC was also involved in sanctions evasion for Iran and Russia. The agency estimated the exchange processed at least $16 billion in illicit funds related to these activities between May 2021 and May 2026. This figure includes roughly $1.5 billion linked to Russian sanctions evasion, with direct transactions with entities sanctioned by the U.S., EU, and UK.

Transactions involving Iran were estimated at $1.87 billion. FinCEN’s analysis found that MEXC engaged in direct trades with over 40 Iranian virtual asset exchanges, with the volume of these exchanges alone exceeding $1 billion.

Bessent Warns Exchanges on Regime-Linked Transactions

In a press release, Treasury Secretary Scott Bessent stated unequivocally, “Financial institutions cannot have it both ways,” adding, “They can either support the Iranian regime or have access to the U.S. financial system, but not both.” He affirmed the Treasury’s commitment to cutting off the economic lifelines to the Iranian regime and preventing the use of digital assets to circumvent U.S. sanctions.

Despite having terms of service that prohibit users from certain sanctioned countries, the Treasury asserted that MEXC processed transactions for sanctioned individuals and institutions, effectively ignoring its own policies.

The action was taken under Section 9714 of the Russian Money Laundering Counteract Act. The order, published in the Federal Register, will become effective after 30 days. Financial institutions and their employees who violate this order may face civil or criminal penalties. The move designates MEXC as a “primary money laundering concern” to the U.S. financial system.

Background on MEXC Global

MEXC Global, a Seychelles-based virtual asset exchange founded in 2018, is one of the world’s top 20 crypto platforms. According to Treasury data, the exchange reported a daily trading volume exceeding $1 billion and held approximately $5 billion in reserve assets as of June 2026.

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Financial institutions cannot have it both ways. They can either support the Iranian regime or have access to the U.S. financial system, but not both.

Scott Bessent, U.S. Treasury Secretary