CTFC Hits KuCoin With $500,000 Penalty, Bans Exchange From Allowing US Users To Trade on Platform

The Commodity Futures Trading Commission (CFTC) has levied a $500,000 penalty and restrictions against crypto exchange KuCoin’s operator, barring it from allowing US users to trade on its platform without proper registration.

The CFTC says a federal court in the Southern District of New York entered a consent order against Peken Global Limited, the entity behind KuCoin.

The order finds the company allowed US participants to access its trading platform without registering as a foreign board of trade.

The court has imposed a $500,000 civil monetary penalty and permanently enjoined Peken Global from future violations.

The order also prohibits the firm from permitting US users to trade unless it complies with CFTC registration requirements.

Regulators noted that disgorgement was not imposed, citing the company’s cooperation in the investigation and related proceedings.

In a parallel criminal case, Peken Global pleaded guilty to operating an unlicensed money transmitting business.

The action resolves part of a broader case brought by the CFTC against KuCoin entities, which alleged multiple violations of the Commodity Exchange Act.

According to the agency, KuCoin offered derivatives and leveraged trading products to US customers without proper registration and failed to implement effective know-your-customer controls.

The complaint also alleged that US users were able to access the platform despite supposed restrictions, including through common tools such as VPNs, and that the exchange did not adequately prevent such activity.

The latest order resolves the CFTC’s claims against Peken Global, while other defendants in the case were dismissed with prejudice.

Generated Image: Midjourney