Cryptocurrency exchange CoinEx has been sued by the New York Attorney General, Letitia James, alleging the firm falsely represented itself as an exchange due to failing to register as a securities and commodities broker-dealer in the state. A 38-page petition filed by James in the New York Supreme Court on Feb. 22 alleged CoinEx “engaged in repeated and persistent fraudulent practices” and violated the state’s Martin Act — considered one of the most strict anti-fraud and securities regulation laws in the United States. She also asserted CoinEx listed various tokens that qualified as “both commodities and securities” naming Amp (AMP), …

The New York Department of Financial Services has reportedly ordered blockchain company Paxos Trust Co. to stop the issuance of dollar-pegged Binance USD (BUSD) stablecoin. The New York regulator's actions come shortlyafter the United States Securities and Exchange Commission issued a Wells Notice to Paxos — a letter the regulator uses to tell companies of planned enforcement action. The notice alleged that Binance USD is an unregistered security. The NYDFS has reportedly asked Paxos to stop creating more of its BUSD token. Paxos will continue to manage redemptions of the product, according to a Binance statement. This is a developing …

Paxos Trust Company — the New York-based stablecoin issuer behind Binance USD (BUSD) and Paxos Dollar (USDP) — is reportedly being investigated by the New York Department of Financial Services (NYDFS). A “person familiar with the matter” told Bloomberg in a Feb. 10 report that the exact motive behind the probe is currently unclear. An NYDFS spokesperson declined to comment on ongoing investigations but noted that the department is broadly working to protect consumers from risks associated with investing in the cryptocurrency market: “The department is in continuous contact with regulated entities to understand vulnerabilities and risks to consumers and …

Along with pro-crypto regulations, mainstream adoption of cryptocurrencies requires a supporting infrastructure that can allow the general public access and exposure to the ecosystem. When considering eight key indicators around taxes, ATMs, jobs and events in crypto, London stands at the top as the most crypto-ready city in the world for businesses and start-ups. UK Prime Minister Rishi Sunak’s vision to “ensure the UK financial services industry is always at the forefront of technology and innovation” is on the right path, reveals research conducted by Recap. An examination of eight key data points determined London to sport the highest crypto-readiness …

The New York Department of Financial Services, or NYDFS, has released guidelines on how licensed crypto firms should handle customer assets should they face “insolvency or similar proceeding”. In a Jan. 23 announcement, NYDFS superintendent Adrienne Harris said crypto firms and exchanges operating under a BitLicense — required in New York state — should segregate corporate funds from users’ virtual currency holdings both on-chain and in the “internal ledger accounts” of the company’s custodian. According to the regulator, crypto firms are expected to hold users’ assets “only for the limited purpose of carrying out custody and safekeeping services”: “A [virtual …

According to new court filings, disgraced FTX founder Sam Bankman-Fried (SBF) will be subject to the forfeiture of roughly $700 million worth of assets if he were to be found guilty of fraud. In a court document filed on Jan 20, U.S. federal prosecutor Damian Williams outlined that the “government respectfully gives notice that the property subject to forfeiture” covers a long list of assets across fiat, shares and crypto. The filings state that most of the assets were seized by the government between Jan.4 and Jan. 19, while it is also looking to lay claim to “all monies and …

The United States Securities and Exchange Commission charged cryptocurrency lending firm Genesis Global Capital and crypto exchange Gemini with selling unregistered securities through Gemini’s “Earn” program. The Commodity Futures Trading Commission started the process of getting a default judgment in its case against Ooki DAO after the decentralized autonomous organization missed the deadline to respond to the lawsuit. It also filed suit against digital artist Avraham Eisenberg and charged him with two counts of market manipulation in connection with an exploit of the decentralized finance platform, Mango Markets. In South Korea, tax agents raided the Seoul headquarters of cryptocurrency exchange …

Eight major media companies including Bloomberg, The Financial Times and Reuters have demanded public disclosure of the two individuals responsible for guaranteeing FTX former CEO Sam Bankman-Fried's $250 million bond. In a Jan. 12 letter addressed to New York District Court Judge Lewis Kaplan, attorneys from Davis Wright Tremaine LLP — acting on behalf of the media giants — argued that “the public’s right to know Bankman-Fried's guarantors outweighed their privacy and safety rights.” Media organizations looking to persuade the judge to unseal the identities of Bankman-Fried's guarantors include the Associated Press, Bloomberg, CNBC, Dow Jones, The Financial Times, Insider …

New York Attorney General Letitia James has filed a lawsuit against Alex Mashinsky, alleging the Celsius founder and CEO made numerous “false and misleading statements” which led to investors losing billions. In a Jan. 5 announcement, the New York Attorney General’s office announced the lawsuit, which allegedly involved defrauding more than 26,000 residents of the U.S. state out of billions of dollars worth of crypto. According to James, Mashinsky’s actions leading up to Celsius declaring bankruptcy contributed to investor losses by misrepresenting the platform’s financial condition and failing to personally register as required by state law. “As the former CEO …

New York regulators announced on Jan. 4 that cryptocurrency exchange Coinbase will pay a $50-million fine and invest a further $50 million in its compliance program, following a settlement with the New York State Department of Financial Services. The fine was issued after regulators found the company had allowed customers to open accounts without conducting sufficient background checks, potentially violating anti-money-laundering laws. The company's failure to properly identify customers and monitor their activity for suspicious activity was initially identified during a routine examination in 2020, but regulator's determined that the company's problems persisted, leading to a formal investigation in 2021. …

The United States Attorney’s Office for the Southern District of New York (SDNY) has formed an FTX Task Force to “trace and recover” missing customer funds, as well as handle investigations and prosecutions related to the exchange’s collapse. The announcement came via a statement from U.S. Attorney Damian Williams who is the federal prosecutor in the FTX case involving founder Sam Bankman-Fried. Charges from the Manhattan attorney’s office against Bankman-Fried include wire and securities fraud, conspiracy to commit wire and securities fraud, money laundering and violation of campaign finance laws. “The Southern District of New York is working around the …

The crypto trader behind the $110 million exploit of decentralized exchange Mango Markets has been arrested in Puerto Rico — and charged with market manipulation and fraud. According to a previously sealed complaint filed with the Southern District of New York made public on Dec. 27, the Federal Bureau of Investigation (FBI) pinned Avraham Eisenberg with one count of “commodities fraud” and one count of “commodities manipulation” in relation to his exploit of Mango Markets. Eisenberg’s Oct. 11 exploit of Mango Markets worked by manipulating the value of the platform’s native token MNGO, artificially inflating its price relative to USD …