CoinEx Pays a Hefty $1.8 Million to Resolve NY Attorney General Lawsuit

1. CoinEx agrees to pay $1.8 million and cease operations in New York to settle a lawsuit from the state’s Attorney General.
2. The settlement includes $1.17 million in refunds to nearly 4,700 investors and a $626,000 fine.
3. This settlement is part of broader enforcement efforts to regulate ‘shadowy’ crypto companies.

The cryptocurrency exchange, CoinEx, has agreed to pay $1.8 million and halt its operations in New York. This decision comes as a result of a lawsuit initiated by the state’s Attorney General, Letitia James, which accused the company of running illegally due to its failure to register with the state.

The settlement, which requires judicial approval, will see CoinEx banned from offering, selling, or buying securities and commodities in New York. Additionally, the platform will no longer be accessible in the state. The payment plan incorporates $1.17 million as refunds for 4,691 investors and a fine of $626,000.

While agreeing to the settlement, CoinEx, founded in 2017 and also known as Vino Global Ltd, refrained from admitting any wrongdoing. Despite this, the Attorney General’s office has emphasized the risk posed by unregistered crypto platforms to investors, consumers, and the broader economy.

The lawsuit, lodged in February, identified CoinEx’s failure to register before transacting in tokens such as AMP, LBRY, LUNA, and Rally as a violation of the Martin Act, a robust state law used to combat financial fraud. This case underscores a wider enforcement initiative targeting ‘shadowy’ crypto companies.

CoinEx’s decision to settle follows similar actions by the U.S. Securities and Exchange Commission against other major platforms, including Binance and Coinbase. The actions underline the increasing scrutiny and regulatory pressure faced by the crypto industry.

Looking ahead, the CoinEx case may serve as a precedent for future regulatory actions against cryptocurrency exchanges. As governments worldwide seek to impose stricter controls on the burgeoning crypto industry, exchanges like CoinEx will have to navigate an increasingly complex regulatory landscape.

It remains to be seen how CoinEx will adapt to these new regulations, but it’s clear that the era of the ‘Wild West’ in cryptocurrency is coming to a close.