Bitcoin and altcoin exchange KuCoin faced a massive exodus after the US Department of Justice accused it of violating anti-money laundering rules and Bank Secrecy Act regulations. Investors are trying to withdraw their assets quickly. Because large-scale withdrawals took place in KuCoin.
More than $1.1 billion left Kucoin
0xscope’s data reveals a significant development in asset movements on KuCoin. The stock market witnessed a significant net outflow of approximately USD 1.195 billion in the last 24 hours. On the other hand, SpotOnChain further highlights the impact of these developments by highlighting that a significant amount of approximately $500 million was withdrawn from KuCoin’s Ethereum wallets in response to the US government’s criminal complaint. Among the withdrawn assets are 274 million USDT, 15,500 ETH, 50 million ONDO. There are also assets such as 12 million FET and 95.38 million GHX.
Despite the asset exodus, KuCoin’s hot wallets still hold $3.6 billion worth of assets on the Ethereum network. According to respected cryptocurrency journalist Colin Wu, three reliable sources revealed to WuBlockchain that KuCoin is considering ceasing operations and putting the exchange up for sale in 2023. The US launched a criminal investigation into KuCoin the same year. Meanwhile, the stock market also came under scrutiny from Chinese authorities. Additionally, people affiliated with various exchanges, including Binance, were aware of the potential sale.
CFTC declares two altcoin projects are commodities
cryptokoin.com As we reported, the case was brought to the agenda yesterday evening. Meanwhile, the US CFTC brought up the issue of asset classification in the case filed against KuCoin. Because, he classified various crypto assets such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) as “commodities”. According to the CFTC’s statement, this classification falls under Section 1a(9) of the Act.
This is a significant development considering the fact that the US Securities and Exchange Commission (SEC) has launched an investigation into the Ethereum Foundation and is also seeking to classify Ether (ETH) as a security. This development continues as authorities continue to struggle with the classification and supervision of crypto assets. Meanwhile, it adds another round of regulatory oversight to the cryptocurrency ecosystem.
So, the CFTC’s lawsuit against KuCoin is a turning point in the classification of crypto assets. In the CFTC’s complaint, Ethereum and Litecoin are mentioned as commodities. As we reported above, the CFTC’s lawsuit against KuCoin comes after the DoJ filed a related lawsuit. Ultimately, the allegations point to the lack of an effective “know your customer” (KYC) policy. It also covers more than $4 billion in suspicious fund transfers.
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Read more: 1.1 Billion Dollars Out of KuCoin After Accusations: Those Two Altcoins Were Classified as ‘Commodities’