24/7 Cryptocurrency News

Crypto Exchange Penalized By New York Regulator For Violating Laws

bitFlyer USA was penalized by the New York State Department of Financial Services (NYDFS) for violating cybersecurity regulations.
Published by
Crypto Exchange Penalized By New York Regulator For Violating Laws

Crypto exchange bitFlyer USA was penalized by the New York State Department of Financial Services (NYDFS) for violating cybersecurity regulations. The NYDFS imposed a civil monetary penalty of $1.2 million on the crypto exchange for failing to maintain a compliant cybersecurity program.

BitFlyer USA, a subsidiary of bitFlyer Holdings, is licensed to operate in New York since 2017. The NYDFS acknowledges the efforts of the crypto exchange to improve its cybersecurity program by the year’s end.

Advertisement

BitFlyer USA Fined by NYDFS

According to a consent order on May 2, the New York State Department of Financial Services has fined bitFlyer USA $1.2 million for violating cybersecurity regulations. BitFlyer USA provides cryptocurrency trading and custodial wallet services in the U.S.

The NYDFS conducted investigations of bitFlyer USA since providing a license under the Virtual Currency Regulation and Cybersecurity Regulation in 2017. The NYDFS found multiple shortfalls in the exchange’s cybersecurity program.

The New York regulator said bitFlyer USA failed to fully comply with the Cybersecurity Regulation. Also, it failed to establish and maintain an effective cybersecurity program through written policies as per the Virtual
Currency Regulation. The exchange has relied on bitFlyer Japan for audits, developments, customer support, and other tasks.

“bitFlyer USA had not performed a comprehensive risk assessment as required by 23 NYCRR § 500.09(a), bitFlyer USA’s cybersecurity program was not designed to protect its electronic systems from unauthorized use in violation of 23 NYCRR § 200.16(a).”

The regulator has asked the crypto exchange to improve its cybersecurity programs until December 31, 2023. However, the NYDFS acknowledges bitFlyer USA’s ongoing efforts to remediate the deficiencies specified in the consent order.

Also Read: Shiba Inu Burn Rate Spikes 30,000%; Can SHIB Price Make A Comeback?

Advertisement

NYDFS Strict Crypto Regulatory Stance

The NYDFS has maintained a strict regulatory stance against the crypto market recently, bringing fines and enforcement against crypto companies.

In fact, the New York regulator’s action against Paxos caused major challenges for Binance after it ordered to stop minting BUSD in February. Coinbase, BitPay, and Robinhood among others were fined by the NYDFS maintaining its strict stance.

It also introduced the Adoption of Virtual Currency Assessment Regulation to collect supervisory fees from licensed cryptocurrency firms operating within the New York state.

Also Read: Top Crypto Copy Trading Platforms For 2023

Share
Varinder Singh

Varinder has over 10 years of experience and is known as a seasoned leader for his involvement in the fintech sector. With over 5 years dedicated to blockchain, crypto, and Web3 developments, he has experienced two Bitcoin halving events making him key opinion leader in the space. At CoinGape Media, Varinder leads the editorial decisions, spearheading the news team to cover latest updates, markets trends and developments within the crypto industry. The company was recognized as Best Crypto Media Company 2024 for high impact and quality reporting. Being a Master of Technology degree holder, analytics thinker, technology enthusiast, Varinder has shared his knowledge of disruptive technologies in over 5000+ news, articles, and papers.

Published by
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Recent Posts

  • 24/7 Cryptocurrency News

Ethena Labs Secures Fresh Funding From ArkStream Capital, ENA Price Spikes

Ethena Labs has secured fresh funding from ArkStream Capital as it expands its ecosystem in…

September 6, 2025
  • 24/7 Cryptocurrency News

SEC Forms International Task Force to Crack Down on Pump-and-Dump Schemes

The U.S. Securities and Exchange Commission has launched a task force designed to tackle cross-border…

September 6, 2025
  • 24/7 Cryptocurrency News

Justin Sun Pledges $20M Buy Following WLFI Wallet Freeze

Justin Sun responded to World Liberty Financial freezing his wallet by promising to purchase $20…

September 6, 2025
  • 24/7 Cryptocurrency News

Expert Blames ‘Secret Committee’ for Rejecting MSTR Stock Inclusion to S&P 500

Michael Saylor's Strategy (NASDAQ: MSTR) missed the inclusion in the S&P 500 index on Friday,…

September 6, 2025
  • 24/7 Cryptocurrency News

MARA Bitcoin Treasury Nears $6 Billion, Trails Only Strategy in Public Rankings

MARA announced that it now holds $5.9 billion worth of Bitcoin. This cements its position…

September 6, 2025
  • 24/7 Cryptocurrency News

Senate Banking Committee Releases Updated Draft Crypto Market Structure Bill

The U.S. Senate Banking Committee has released an updated version of the draft Crypto Market…

September 6, 2025