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KuCoin’s $22 Million Settlement: Ceases New York Operations Amid Rising Regulatory Scrutiny

KuCoin $22 Million Settlement

KuCoin, a major cryptocurrency exchange, has reached a settlement of $22 million and will restrict access for users in New York, according to court documents filed at the Supreme Court of the State of New York County.

The settlement includes a $16.77 million refund to New York customers and a $5.3 million payment to the State Attorney General.

The resolution addresses allegations of KuCoin violating securities laws by offering unregistered tokens, such as ether.

It underscores the intensified regulatory scrutiny facing crypto platforms for issues like fraud and insufficient investor protections.

Lawsuit Against KuCoin

In March, Attorney General Letitia James filed a lawsuit against KuCoin, a Seychelles-based exchange, alleging a failure to register with the state before facilitating cryptocurrency transactions.

The subsequent settlement mandates KuCoin to cease securities and commodities trading activities in New York.

Attorney General James emphasised that crypto companies must adhere to the same rules as traditional financial institutions.

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

KuCoin Compliance

KuCoin CEO Jhonny Lyu confirmed the settlement in his X account (formerly known as Twitter), expressing the exchange’s commitment to compliance.

He assured users about the security of their assets during the process and mentioned that affected users would receive notifications to retire from KuCoin.

Crackdown on Crypto Firms

This settlement follows the New York Attorney General’s (NYAG) legal actions against other crypto firms, including a lawsuit against Genesis Global and Gemini in October.

The NYAG has been actively addressing issues of fraud and non-compliance within the cryptocurrency sector, securing settlements and legal actions against exchanges like CoinEx.

The cryptocurrency industry faces increased scrutiny from U.S. regulators and law enforcement, with recent cases involving FTX founder Sam Bankman-Fried and the founder of Binance.

These incidents highlight the growing emphasis on anti-money laundering laws and investor protection in the crypto space.

As KuCoin settles and adjusts its operations, the broader implications of regulatory actions in New York may shape the landscape for cryptocurrency exchanges, reinforcing the need for compliance in an evolving regulatory environment.

* Original content written by Coinlive. Coinbold is licensed to distribute this content by Coinlive.