The cryptocurrency exchange KuCoin has agreed to disable its services from its New York users and pay a $22 million fine per a lawsuit by the state according to a recent report.
KuCoin was issued in March this year for failing to register with the authorities before allowing New York investors to engage with the platform. Following the settlement of the lawsuit, KuCoin will also quit trading securities and commodities in New York.
Attorney General Letitia James, who filed the lawsuit against the exchange stated today that “crypto companies should understand that they must play by the same rules as other financial institutions.”
In response to numerous collapses, rug pulls, and fraud, nations, and states are tightening operations within crypto services. The government also claims that most of the crypto assets are securities and have to be treated as such.
The lawsuit against Genesis Global and Gemini in October also originated from the Attorney General’s office. The suit alleged that the exchanges defrauded investors of over $1 billion. Also, in June CoinEx was sued for registration violations from the same office. CoinEx afterward reached a $1.8 million settlement fee.
The cases involving FTX founder Sam Bankman Bankman-Fried and Do Kwon, the founder of Terra Luna, were notable incidents of fraud within the industry. Each of the incidents led to the loss of a significant amount of funds by investors, and the bankruptcy of affiliated firms.
Last month, the founder of crypto exchange, Binance Changpeng Zhao pleaded guilty to a money laundering violation charged by the United States. He was released on a $175 bond, and a sentence is expected next year after stepping down as CEO of the company as part of the terms of the settlement.
In October the UK government also flagged KuCoin and over 100 other crypto firms as unauthorized, saying they are yet to register with the authority.
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