OKX Settles with DOJ for $500M Over Unlicensed Money Transmitter Charges

OKX, one of the world's largest cryptocurrency exchanges, has reached a settlement with the U.S. Department of Justice (DOJ) over charges related to operating as an unlicensed money transmitter. The settlement, announced on Monday, involves an affiliate of OKX, Aux Cayes FinTech Co. Ltd., paying over $500 million in penalties and forfeited fees.

The settlement resolves allegations of fraudulent and non-compliant activities at the exchange that occurred in previous years. OKcoin, the American division of OKX, had also received a subpoena from the Commodity Futures Trading Commission (CFTC) in February 2023, which referred to "Certain persons engaged in fraud and other unlawful conduct with respect to digital asset transactions."

A source familiar with the situation revealed that the CFTC probe into OKcoin relates to the 2024 flash crash of the exchange's native token, OKB, following a sudden price drop on January 23, 2024. OKX had promised to compensate users for losses resulting from the crash. An internal document circulated to OKX staff in January 2024 highlighted a new ethics and compliance helpline to address concerns or issues about ethical conduct, policy violations, or suspected illegal behavior.

Representatives from OKX did not immediately respond to requests for comment, and a CFTC spokesperson declined to comment on the matter.