He added that the findings of the internal security audit report, revealed that part of Bitcoin, ERC-20, and other tokens in Kucoin's hot wallets were transferred out of the crypto exchange.

[13] The settlement addressed allegations that KuCoin operated without proper registration as a securities and commodities broker-dealer and misrepresented its status as a cryptocurrency exchange.

[13] In March 2024, KuCoin and its co-founders, Chun Gan and Ke Tang, were indicted on charges of operating an unlicensed money transmitting business and failing to implement required anti-money laundering protocols.

[13] In January 2025, KuCoin admitted to charges of operating an unlicensed money transmitting business and agreed to pay nearly $300 million in fines and forfeitures, resolving the criminal proceedings.

[13] In March 2023, New York's attorney general Letitia James sued Kucoin for failing to register with the state before letting investors buy and sell cryptocurrencies on its platform.

[17][18] In March 2024, the United States Commodity Futures Trading Commission (CFTC) filed criminal charges against Kucoin and two of its founders, accusing the cryptocurrency exchange of violating U.S. anti-money laundering laws by failing to vet customers, allowing billions of dollars in illicit funds to be transferred since its founding in 2017[19][20] Prosecutors said Kucoin sought business from U.S. customers without registering with the Treasury Department and putting in place procedures to verify clients' identities as required by U.S.

[27] In May 2024, Indian government's Financial Control Unit (FIU) approved KuCoin's application to register as a Virtual Asset Service Provider (VASP) after it paid a penalty of 3.5 million INR for regulatory non-compliance.