Crypto exchange CoinEx agrees to refund customers to settle case with NYAG
- Hong Kong-based crypto exchange, CoinEx is banned from operating in New York.
- The crypto entity had to pay a heft fine for operating in the state without meeting the registration requirements.
New York Attorney General Letitia James announced that the agency recovered over $1.7 million from the crypto exchange – CoinEx. The crypto platform, based in Hong Kong, was penalized by the government authority for operating without registering in the state.
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CoinEx misrepresented itself as a crypto exchange
The NYAG sued the crypto exchange in February 2023. The main reason was not registering as a securities and commodities broker-dealer. The AG also held CoinEX responsible “for falsely representing itself as a crypto exchange”.
In New York, for any business to be recognized as an exchange, it should either be registered with the SEC or CFTC. Additionally, in this case, the Attorney General had labeled LUNA, LBC, RLY, and AMP as securities and commodities.
The announcement of 15 June stated that the Hong Kong-based crypto entity will be banned from operating in New York. In addition, CoinEx has to refund over $1.1 million to New York customers. And, the refund process should be completed within the next 90 days. The crypto firm is also required to pay a penalty of over $600,000 to New York. The press release further said,
“In addition, CoinEx must implement geoblocking to prevent New York IP addresses from accessing their platform. CoinEx is also prohibited from creating any new accounts for U.S. customers and existing U.S. customers can only withdraw their crypto from the platform.”
Another such organization that exited New York was the European digital assets institution Nexo. The organization reached an agreement with the NYAG and decided to off-board its clients.