KuCoin Settles With New York, Agrees to Pay $22 Million and Exit
New York State Attorney General Letitia James stated on Tuesday that cryptocurrency exchange KuCoin has agreed to pay $22 million to settle a lawsuit brought by the state earlier this year. Moreover, KuCoin was accused of illegally operating in New York without proper registration.
As part of the settlement shared by Reuters, KuCoin has agreed to:
- Pay $5.3 million to New York State.
- Refund $16.7 million worth of cryptocurrency to 177,800 New York-based investors who used the platform.
- Block all New York-based users from accessing its platform going forward.
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James said crypto companies should play by the same rules
“Crypto companies should understand that they must play by the same rules as other financial institutions,” James said. The settlement is part of AG James’ broader push to increase regulation and oversight over the cryptocurrency industry, which has faced high-profile collapses and allegations of fraud in recent months:
- In October, James filed a lawsuit against crypto firms Genesis Global and Gemini, accusing them of defrauding investors out of over $1 billion.
- She reached a $1.8 million settlement in June with Hong Kong exchange CoinEx for illegally operating in New York.
The lawsuit filed by James in March also alleged that KuCoin investors can buy and sell popular cryptocurrencies, including ETH and LUNA, which are securities and commodities. The press release that shared the lawsuit also highlighted that it was the first time a large cryptocurrency like ETH was called a security by a regulator.
The KuCoin settlement and lawsuits highlight the growing scrutiny cryptocurrency firms are facing from New York and federal regulators over investor protections, anti-money laundering controls, and following proper licensing and compliance procedures.
