KuCoin News: Crypto Exchange To Pay $300M Penalty to US DOJ; Exits US

Crypto trading platform KuCoin has pleaded guilty to unlicensed money transmitter offenses filed by the United States Department of Justice (DOJ). This plea marks the biggest shift in the lawsuit, implicating its co-founders, Chun Gan and Ke Tang. 

KuCoin Pleads Guilty to Unlicensed Money Transmitter Offenses

According to an update from Samuel Rubenfeld, a Senior Reporter with MLExclusive, the exchange entered the guilty pleas at the US District Court for the Southern District of New York. In addition to the guilty plea, its co-founders entered deferred prosecution agreements with the Justice Department.

Per the statement from the US Attorney’s Office, Peken Global Ltd, one of the companies that operates the KuCoin exchange, entered the plea deal. Following the agreement, the trading platform agreed to pay US authorities $300 million.

This settlement includes $113 million in fines and $184.5 million in civil forfeitures. KuCoin will also pay $22 million in fines and refunds and cease trading in New York. The deferred prosecution agreements will allow them to avoid further legal action. However, each of them will forfeit the sum of $2.7 million.

Beyond this penance, both co-founders will step down from their roles with the trading platform. Gan already shared the update of his departure, describing the deal as favorable. Gan and Eric will no longer be active at the exchange moving forward.

DOJ Charges Against the Crypto Exchange

The DOJ filed the charges against KuCoin in March 2024, accusing it of facilitating up to $4 billion in criminal-linked funds. The trading platforms were also accused of flouting Anti-Money Laundering (AML) and Know Your Customer (KYC) provisions.

This guilty plea marks one of the high-profile concessions most crypto entities make to resolve lawsuits with American authorities. As reported earlier by Coingape, Robinhood paid $45 million to settle Federal securities violations with the Securities and Exchange Commission (SEC).

Recall that the BitMEX exchange also suffered a related fate featuring violations of the Bank Secrecy Act (BSA) in 2022. Beyond the fines, Arthur Hayes, Samuel Reed, and Benjamin Delo had no active role at the exchange since.

Crackdowns and Regulations

With President Donald Trump now in power, the regulatory outlook for the digital currency is changing. However, experts have warned against the unrealistic expectations of tempered crackdowns.

While the appointed US SEC Chair Mark Uyeda is driving reforms, the regulators may maintain a zero tolerance to law violations. A crypto task force led by Hester Peirce has been established to look into key changes that may benefit the industry. This task force, US DOJ and industry input will help shape the regulatory landscape.