(WNY News Now) – New York Attorney General Letitia James has successfully concluded a legal battle against cryptocurrency trading giant KuCoin, resulting in a $22 million settlement. The platform, accused of failing to register as a securities and commodities broker-dealer and misrepresenting itself as a crypto exchange, now faces significant financial penalties and operational restrictions.
New York – New York Attorney General Letitia James has achieved a major victory in the legal pursuit against KuCoin, one of the largest cryptocurrency trading platforms. The $22 million settlement resolves allegations that KuCoin operated without proper registration as a securities and commodities broker-dealer and misleadingly presented itself as a crypto exchange.
The consent order mandates KuCoin to refund more than 150,000 New York investors a total of $16.7 million and pay an additional $5.3 million to the state. This legal action comes as part of Attorney General James’ broader efforts to enhance oversight and regulation of cryptocurrency companies, with over $500 million recovered from predatory platforms to date.
KuCoin, headquartered in Seychelles, facilitated cryptocurrency trading through its website and mobile app, allowing investors to trade popular tokens like ETH, LUNA, and UST. An investigator from the Office of the Attorney General was able to create an account with KuCoin using a New York-based IP address, revealing the platform’s failure to comply with state laws requiring securities and commodities brokers to register.
The violation extended to KuCoin’s “KuCoin Earn” investment product, where the platform pooled investors’ cryptocurrencies to generate income without the necessary registration. Furthermore, KuCoin falsely claimed to be a registered exchange, overlooking the requirement to be registered with the Securities and Exchange Commission or designated by the Commodity Futures Trading Commission, as stipulated by New York law.
Under the settlement, KuCoin is obligated to provide full refunds of $16,766,642 to 177,800 New York investors. Eligible investors can withdraw their assets directly from KuCoin within the next 90 days, while those who remain eligible after this period can file a claim via email at kucoinrefund@ag.ny.gov.
In addition to the financial repercussions, KuCoin is now banned from trading securities and commodities in New York, with the platform prohibited from catering to New York customers. Existing customers from the state are limited to withdrawing their crypto assets, and KuCoin is mandated to cooperate with U.S. law enforcement by promptly responding to asset freeze requests and information inquiries.
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