US Treasury cuts MEXC off from American financial institutions, citing $16.7 billion in illicit flows

The U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN) on Nov. 6 found Seychelles-incorporated crypto exchange MEXC Global to be a financial institution of primary money laundering concern in connection with Russian illicit finance and issued an order barring U.S. financial institutions from sending funds to or receiving funds from it. FinCEN said MEXC facilitated the movement of $16.7 billion in funds connected to Russian illicit finance and other illicit activities, including sanctions evasion and cybercrime, between May 2021 and May 2026. Treasury said the action is part of Operation Economic Outcast, its campaign to cut off the Iranian regime's economic lifelines.

According to the order, MEXC was founded in 2018 and operates in more than 170 countries without a virtual asset service provider license. As of June 2026 it processed more than $1 billion in transactions a day and held about $5 billion in reserve assets, placing it among the 20 largest crypto exchanges in the world by trading volume, FinCEN said.

FinCEN invokes Section 9714 of the Russian money laundering law

The order was issued under Section 9714 of the Combating Russian Money Laundering Act. The provision allows the Treasury secretary to impose special measures, such as prohibiting certain transmittals of funds by U.S. financial institutions, when a financial institution outside the United States is found to be of primary money laundering concern in connection with Russian illicit finance.

FinCEN said MEXC had nearly $1.5 billion in direct and indirect exposure to transactions linked to Russian sanctions evasion over the same period, including $232 million in direct transactions with entities sanctioned by the United States, the European Union and/or the United Kingdom. It handled about $129 million with sanctioned Russian exchange Garantex and $4.1 million with its successor Grinex, and kept transacting with both as recently as June 2026. At least $26 million benefited the A7 Network, a payment network tied to sanctions evasion, and almost $200 million was connected to A7A5, a ruble-backed stablecoin.

More than $1 billion directly with over 40 Iranian exchanges

FinCEN said MEXC facilitated the transmission of nearly $2 billion connected to identified Iranian actors or known or suspected terrorist groups. About $1.87 billion of that had exposure to Iran, and more than $1 billion took the form of direct transactions with more than 40 identified Iranian crypto exchanges. MEXC's user agreement bars people and entities in Iran from using the platform. About $22 million was associated with the Central Bank of Iran and the Islamic Revolutionary Guard Corps (IRGC) and its Quds Force, and about $36 million related to the Gaza-based Al-Qassam Brigades and other Iran-linked terrorist groups.

North Korea also appears in the order. FinCEN said sanctioned North Korean money launderer Sim Hyon Sop received about $350,000 through MEXC between June and September 2025. When the United States sanctioned Sim in April 2023, it also listed his crypto wallet addresses. At least $1.99 billion in cybercrime funds, including darknet market activity, ransomware payments and scam proceeds, moved through MEXC, an average of more than $1 million a day. Suspected ransomware payments received by MEXC from January 2022 to July 2024 alone totaled $37.9 million.

"Financial institutions cannot have it both ways."

Scott Bessent, U.S. Treasury Secretary

U.S. institutions can neither send funds to nor receive funds from MEXC

The order binds U.S. financial institutions rather than MEXC itself. Banks, money transmitters and other covered U.S. financial institutions may not send funds to MEXC or receive funds from it, and the ban covers transfers of crypto, including bitcoin. It applies to MEXC's overseas subsidiaries, branches and offices and to any successor entity operating under a new name, while any MEXC branches, subsidiaries and offices located in the United States are excluded from the definition.

The order takes effect 30 days after publication in the Federal Register and has no end date. FinCEN acknowledged that there are few ways to reject incoming crypto transfers in advance, and the order lays out steps for returning crypto received from MEXC. Covered institutions and their officers, directors, employees and agents may face civil or criminal penalties for willful violations.

South Korea ordered MEXC blocked last month

MEXC is also classified in South Korea as an illegal, unregistered virtual asset operator. The Financial Services Commission's Korea Financial Intelligence Unit (FIU) said on Oct. 13 that the Korea Media and Communications Standards Commission, after reviews on Oct. 6–7, decided to block domestic access to the websites of 27 virtual asset operators that had not registered under the country's Act on Reporting and Using Specified Financial Transaction Information. MEXC was second on the list of 27, after KuCoin. MEXC is also on the FIU's list of 44 unregistered operators referred to investigators. Earlier, apps of unregistered operators had been blocked on Google's and Apple's app stores.

The FIU said at the time that only 28 virtual asset operators were legally registered in South Korea and urged users to withdraw their crypto and deposits immediately if they found an operator to be unregistered. For users who have trouble withdrawing because of the block, it said withdrawal methods would be explained through the Digital Asset eXchange Alliance (DAXA), a body of South Korean exchanges. The FIU also warned that people who use referral links to steer others to unregistered exchanges could face criminal charges.