KuCoin Resolves $22 Million Settlement with New York, Commits to Restrict User Access in the State

Exiting the New York market, crypto exchange KuCoin has reached a $22 million settlement in response to a lawsuit filed earlier this year by the state’s Attorney General, Letitia James. The legal action accused KuCoin of violating New York’s laws by listing unregistered securities, including ether and other tokens. The settlement terms involve a $5.3 million payment to the state and a cryptocurrency refund of $16.7 million to 177,800 New York investors. In light of the resolution, James emphasized the importance for crypto companies to adhere to the same regulatory standards as traditional financial institutions.

New York’s Regulatory Initiatives and Proactive Investigations
Positioned at the forefront of shaping cryptocurrency regulations in the United States, New York has emerged as a dynamic state in crafting innovative policies. In a recent development, the New York Department of Financial Services unveiled comprehensive guidance aimed at enhancing the processes surrounding the listing and delisting of digital assets by firms. This proactive approach underscores New York’s commitment to fostering a robust regulatory framework for the evolving crypto landscape. Notably, the state has not hesitated to investigate other cryptocurrency entities, as evidenced by the 2021 resolution between Bitfinex, Tether, and the New York Attorney General’s office, culminating in a $18.5 million settlement after a protracted two-year dispute.

The Attorney General’s office accused Tether of not maintaining a ‘1-to-1’ backing with USD in a bank account. In a broad legal action in October, Attorney General James sued crypto entities Gemini, Genesis, and Digital Currency Group for alleged investor fraud. KuCoin CEO Johnny Lyu confirmed the settlement on X (formerly Twitter), assuring users that asset security is a top priority. Users considering leaving KuCoin will receive a notification shortly. Lyu urged users to rely on KuCoin’s official website for accurate information and cautioned against potential rumors in the upcoming weeks.

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