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KuCoin Crypto Exchange In Trouble? Dutch Central Bank Thinks So

According to the Dutch Central Bank, the cryptocurrency exchange KuCoin is operating illegally within the Netherlands.
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KuCoin Crypto Exchange In Trouble? Dutch Central Bank Thinks So

On Thursday, the Dutch central bank issued a statement claiming that the cryptocurrency exchange KuCoin is operating in the Netherlands without having the proper registration to do so. According to a statement released by the bank, KuCoin is a subsidiary of a business called MEK Global Limited (MGL), which is registered in the Seychelles.

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KuCoin Lacks Legal Registration

As per De Nederlandsche Bank (DNB), customers of the exchange are not breaking the law, but they may be at an increased risk of becoming involved in money laundering and illegal methods of financing terrorism.

KuCoin, which does not have a license in the United States, however, is one of the leading cryptocurrency exchanges globally in terms of the trading volume.

Read More: Announcing KuCoin’s $10 Million Strategic Investment From SIG

It operates in over 200 countries and ranks among the highest in number of users, mostly due to its low trading fees in comparison to its rivals.  In October of 2019, the exchange opened for business in the Netherlands.

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KuCoin’s Proof Of Reserves

On other recent news, KuCoin recently released its proof-of-reserves to usher in transparency, with the help of a leading audit firm Mazars. The report prepared by Mazars concluded that KuCoin’s BTC, ETH, USDT and USDC reserves are overcollateralized, which are 101%, 100%, 102% and 101% respectively.

While speaking about its reserves, Johnny Lyu, CEO of KuCoin, commented that,

As a people’s exchange, we value users’ trust in us and commit to ensuring that we contribute in every way to building a culture of transparency in the industry. Our cooperation with Mazars is just one of the measures to ensure we follow through on that commitment to our users.

Read More: How Proof Of Reserve Works?

Customers’ main, trade, margin, robot, contract, high frequency trading, pool, risk, and trust accounts for BTC, ETH, USDT, and USDC were among the few parameters that were analysed as part of the collateralization audit.

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Pratik Bhuyan

Pratik has been a crypto evangelist since 2016 & been through almost all that crypto has to offer. Be it the ICO boom, bear markets of 2018, Bitcoin halving to till now - he has seen it all.

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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.
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