Crypto Exchange KuCoin Exits New York with $22M Settlement | Coinspeaker

Crypto Exchange KuCoin Exits New York with $22M Settlement

As part of the settlement, KuCoin will refund $16.77 million to New York customers and pay an additional $5.3 million to the Attorney General of the State of New York.

Bhushan Akolkar By Bhushan Akolkar Julia Sakovich Edited by Julia Sakovich Updated 2 mins read
Crypto Exchange KuCoin Exits New York with $22M Settlement
Photo: Depositphotos

KuCoin, a cryptocurrency exchange, has agreed to a settlement of $22 million and will cease access for users in New York state, as revealed in court documents filed on Tuesday at the Supreme Court of the State of New York County.

As part of the settlement, KuCoin will refund $16.77 million to New York customers and pay an additional $5.3 million to the Attorney General of the State of New York. This resolution addresses allegations that the exchange violated securities laws by providing tokens, including ether, that qualify as securities without proper registration with the attorney general’s office.

In March, Attorney General Letitia James also filed a lawsuit against KuCoin, a Seychelles-based platform, alleging that the exchange did not register with the state before allowing investors to engage in buying and selling cryptocurrencies on its platform. In a statement on Tuesday, James further added:

“Crypto companies should understand that they must play by the same rules as other financial institutions.”

The resolution, which also includes KuCoin ceasing securities and commodities trading activities in New York, aligns with the increased scrutiny from U.S. Regulators and law enforcement agencies addressing issues of fraud, money laundering, and insufficient investor protections within the cryptocurrency sector. In his tweet on Tuesday, KuCoin CEO Jhonny Lyu said:

“I want to update all of you about our latest compliance action. @kucoincom has reached a settlement with the New York Attorney General (NYAG), solidifying our commitment to compliant operations. Under our agreement, users required to retire from KuCoin will receive an email or SMS in about 10 days and onwards. If you don’t receive either of these, you’re alright. Rest assured – your asset security is always guaranteed and remains our top priority during this process.”

NYAG Hits Out at Exchanges

In October, Attorney General Letitia James filed a lawsuit against cryptocurrency firms Genesis Global, its parent company Digital Currency Group (DCG), and Gemini, alleging the fraudulent activity that resulted in investors losing over $1 billion. DCG dismissed the lawsuit as groundless.

In June, James’ office secured a $1.8 million settlement with Hong Kong-based cryptocurrency exchange CoinEx for operating unlawfully due to its failure to register with the state.

Recently, FTX founder Sam Bankman-Fried faced federal charges and was convicted of embezzling billions of dollars from customers of the cryptocurrency exchange. Simultaneously, the founder of rival platform Binance agreed to plead guilty to violating US anti-money laundering laws.

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Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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