As US officials level more legal accusations, cryptocurrency exchange KuCoin has tried reassuring its users that their assets are safe despite the growing legal pressure.
Prosecutors in the Southern District of New York (SDNY) and the Commodity Futures Trading Commission (CFTC) have criticised the exchange. On March 26, the exchange said, “KuCoin is operating well, and the assets of our users are safe.”
KuCoin said it would follow the rules and laws of many different countries, showing its dedication to strict compliance.
KuCoin’s native token, KuCoin Token (KCS), has lost 13% of its value in the last 24 hours, trading at $12.43. This is because of these legal battles.
KuCoin’s Operational Impact and Allegations
The exchange also said that Polkadot’s Ask Me Anything (AMA) session has been pushed back because they need to make a new plan for the event while the legal problem is still ongoing.
The United States Department of Justice (DOJ) has directly accused KuCoin and its founders, Chun Gan and Ke Tang, of laundering money on purpose. There are claims that the Bank Secrecy Act was broken, money was sent without a license, and people tried to hide that they had US clients to get around Anti-Money Laundering (AML) and Know Your Customer (KYC) rules.
According to Darren McCormack, Deputy Special Agent in Charge for the U.S. Department of Homeland Security, KuCoin’s operations are part of an “alleged criminal conspiracy on a massive scale,” which allows service to over 30 million customers without following the law. U.S. Attorney Damian Williams condemned KuCoin’s alleged US rules and regulations violations.
Wu Blockchain, a Chinese crypto journalist and market expert, says that KuCoin thought about shutting down and selling the exchange in 2023 because of a criminal investigation in the US and several inquiries in China. It was also said that employees from several platforms, including Binance, were told about the possible sale of KuCoin.
At the end of March, the US government officially sued KuCoin and its owners in criminal and civil ways. Gan and Tang are both Chinese citizens and are currently on the run. If caught, they could each face up to 10 years in jail.
Even though KuCoin is in a legal storm, the exchange keeps assuring its users that their assets are safe, even though the ongoing legal processes cast a shadow over its future operations.
