In a significant legal development, KuCoin, one of the world’s leading cryptocurrency exchanges, has pleaded guilty to operating an unlicensed money-transmitting business in the United States. The company has agreed to pay approximately $297 million in fines and forfeitures as part of the settlement. 
The penalties comprise a $112.9 million criminal fine and a $184.5 million forfeiture. Additionally, KuCoin will cease its operations in the U.S. market for a minimum of two years. Co-founders Chun “Michael” Gan and Ke “Eric” Tang have entered into deferred prosecution agreements, each agreeing to forfeit $2.7 million and step down from their management roles within the company. 
The U.S. Department of Justice highlighted that KuCoin facilitated billions of dollars in suspicious transactions due to inadequate anti-money laundering (AML) and know-your-customer (KYC) protocols. The exchange failed to report suspicious activities and did not register with the Financial Crimes Enforcement Network (FinCEN), as required by U.S. law. 
Founded in 2017 and based in Seychelles, KuCoin rapidly expanded its global presence, amassing over 30 million registered users across more than 200 countries. Despite its international reach, the platform did not implement effective AML and KYC measures, allowing users to conduct transactions without proper identification. 
This settlement follows a previous agreement in December 2023, where KuCoin consented to block users in New York and pay $22 million to settle allegations of operating without proper registration in the state. The company has expressed intentions to enhance its compliance practices and explore opportunities to re-enter the U.S. market with the necessary licenses in the future. 
The case underscores the increasing regulatory scrutiny on cryptocurrency exchanges and the imperative for such platforms to adhere to financial regulations designed to prevent illicit activities.
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