KuCoin Founders Step Down in $300M Settlement Over US Charges

KuCoin Co-Founders Step Down Amid $300M Settlement Over US Charges

KuCoin, a leading cryptocurrency exchange based in the Seychelles, has pleaded guilty to operating an unlicensed money-transmitting business and agreed to pay nearly $300 million in fines and forfeitures. The company's founders, Chun Gan and Ke Tang, both Chinese nationals, have signed deferred prosecution agreements, avoiding further legal action. They will forfeit $2.7 million each and step down from their roles at the company as part of the settlement agreement.

The charges stemmed from a March 2024 indictment against KuCoin and its founders. Prosecutors accused the company of running an unlicensed money-transmitting business and failing to implement an anti-money laundering program. The case follows KuCoin's December 2023 settlement with New York state regulators, in which the exchange agreed to pay $22 million in fines and refunds and halt trading in New York.

The KuCoin penalty is the latest in a series of U.S. enforcement actions targeting crypto exchanges. Earlier this month, Seychelles-based BitMEX was ordered to pay for failing to comply with U.S. anti-money laundering laws.

In a statement, Gan announced his departure from the company, describing the resolution as a "favorable outcome" that dismisses all charges against him and co-founder Ke Tang upon satisfaction of specific conditions. He emphasized that neither he nor Tang intended to violate U.S. laws and expressed plans to pursue new blockchain ventures, reaffirming his belief in the technology's transformative potential.

Tang, also known as Eric, who was indicted along with Peken in March 2024, will also "no longer have any role in KuCoin’s management or operations,” prosecutors said.

The case highlights the ongoing scrutiny of the cryptocurrency sector and the regulatory challenges ahead. Despite the legal setbacks, KuCoin's founders have negotiated deferred prosecution agreements, which may allow them to mitigate personal repercussions while facing substantial financial penalties. The broader implications for the cryptocurrency sector may shift towards a more regulated framework that could actually benefit compliant players.