KuCoin Facing Legal Trouble in the US: Is Your Crypto Safe?

KuCoin Pays $297M Fine, Exits U.S. Market Following Criminal Charges

KuCoin has pleaded guilty to running an unlicensed money transmission business in the U.S. The exchange will pay a hefty $297 million penalty and halt all operations in the country for at least two years.

The U.S. Department of Justice (DOJ) revealed that KuCoin’s parent company, Peken Global Ltd., admitted to failing to implement proper anti-money laundering (AML) measures and neglected to register with the Financial Crimes Enforcement Network (FinCEN). This lack of compliance allegedly enabled billions of dollars in suspicious transactions, including potential criminal proceeds from darknet markets, ransomware, and fraud.

KuCoin Founders Step Down Amid Fallout

As part of the settlement, KuCoin founders Chun Gan (Michael) and Ke Tang (Eric) have agreed to step down from all management roles and pay $2.7 million each. Both have also entered two-year deferred prosecution agreements, which means they won’t face immediate criminal charges as long as they comply with the settlement terms.

New CEO Eyes Compliance and Potential U.S. Comeback

BC Wong, KuCoin’s newly appointed CEO, acknowledged the regulatory blow but framed it as a necessary step for the exchange’s future. “This marks a new chapter for KuCoin, reinforcing our commitment to compliance, security, and innovation,” he said. Wong also hinted at a possible return to the U.S. market, stating that the company is exploring regulatory pathways to reenter with proper licensing.

Meanwhile, legal representatives for KuCoin’s founders have emphasized that the settlement does not indicate any intent to facilitate money laundering or fraud, instead attributing the violations to regulatory missteps.

What’s Next for KuCoin Users?

With KuCoin temporarily exiting the U.S., affected users will need to explore alternative exchanges for trading. While the platform remains operational in other regions, traders may want to keep an eye on future regulatory developments to see if KuCoin can stage a comeback.

For now, the crypto industry is watching closely as regulators ramp up enforcement against non-compliant platforms, making it clear that the days of regulatory loopholes are coming to an end.