Continued by theNew York Statethe KuCoin crypto exchange admits defeat and settles 22 million dollars. L’exchange go to retire also from market to avoid a lawsuit.
Binance remains the most heavily condemned crypto player to date in the United States. But certainly not the only one. It’s now the turn of KuCoin to pull out the checkbook to put an end to the New York State lawsuit.
Last March, its Attorney General launched hostilities against KuCoin. The reason: providing investment services without first registering. The result: a settlement and millions of dollars in compensation.
16.7 million in refunds to investors
In total, the crypto exchange has pledged to pay out 22 million dollarsincluding fines and refunds. KuCoin will pay out $16.7 million to 177,800 New York investors.
In addition, the company will pay $5.3 million to the State of New York, according to U.S. Attorney Letitia James. Finally, the exchange will cease trading in the territory. With these concessions, KuCoin puts an end to the lawsuits.
The payments are coercion for failing to register as a securities and commodities broker and for fraudulently holding itself out as a crypto-currency exchange.
Offshore platforms a danger
Unregistered offshore crypto-currency platforms represent a risk to investors, consumers and the economy in general,” Letitia James. denounces in a statement.
“I will continue to take action against any company that brazenly ignores the law and jeopardizes the savings and investments of New Yorkers,” the prosecutor further warns.
Based in the Seychelles, KuCoin in fact operates from a tax haven, as FTX previously did with the Bahamas. And the company’s bankruptcy has since prompted the US authorities to tighten controls and sanctions.
Regulatory tightening in the US
Offering the sale and purchase of crypto assets from its website and mobile app, KuCoin is not authorized to act as an exchange on US soil. To do so, it must obtain the approval of the SEC or Commodity Futures Trading Commission, denounced the State of New York.
KuCoin, the fourth-largest market player in terms of trading volume (spot and derivatives), was not the US government’s first target. Two weeks earlier, the U.S. Attorney’s Office opened similar proceedings against CoinEx.
New York, along with 9 other states, was also involved in proceedings against Nexo. Here too, the case was resolved by money. Nexo paid a $45 million fine at the beginning of the year, including $22.5 million to the securities regulator.
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