Kucoin fined $300 million in guilty plea for operating unlicensed crypto business
Kucoin fined $300 million in guilty plea for operating unlicensed crypto business
In a landmark case underscoring the ongoing challenges in regulating the cryptocurrency industry, KuCoin, a Seychelles-based cryptocurrency exchange, pleaded guilty to operating an unlicensed money transmitting business and agreed to pay nearly $300 million in fines and forfeitures. The resolution comes after earlier civil claims by New York regulators in December 2023.
As part of its plea agreement before U.S. District Judge Andrew Carter in Manhattan, KuCoin was fined approximately $113 million and ordered to forfeit $184.5 million. The charges stemmed from allegations that KuCoin, along with its founders Chun Gan and Ke Tang, operated without proper licensing and failed to implement required anti-money laundering (AML) protocols. Both founders signed deferred prosecution agreements, each agreeing to forfeit $2.7 million, reports Bloomberg.
This is not the first legal challenge KuCoin has faced. In late 2023, the exchange agreed to pay $22 million to settle claims with the New York State Attorney General’s Office, which accused it of operating unlawfully as a securities and commodities broker-dealer. KuCoin also ceased operations in New York as part of that settlement.
Broader implications for the crypto industry
The KuCoin case follows closely on the heels of a similar legal outcome for BitMEX, another Seychelles-based cryptocurrency exchange. Earlier this month, BitMEX was fined $100 million for violating U.S. anti-money laundering laws, including failing to verify customer identities under the Bank Secrecy Act.
These cases mark the tail end of a broader crackdown on cryptocurrency exchanges by the U.S. Justice Department during the Biden administration. The new administration under President Donald Trump has signaled a potential easing of regulatory scrutiny, with promises of a more crypto-friendly environment.
While KuCoin’s settlement resolves significant legal challenges, it also highlights the need for crypto exchanges to strengthen compliance measures. The industry will closely watch how the Trump administration’s policies shape the regulatory landscape and influence future enforcement actions.
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