OKX Pleads Guilty! DOJ Slaps $500M Fine for Violating U.S. Crypto Laws

OKX, one of the world’s largest cryptocurrency exchanges, has admitted to breaking U.S. laws and settled with the Department of Justice (DOJ) for over $500 million. The exchange acknowledged operating in the U.S. without the required license and agreed to pay hefty penalties and forfeitures.

With this settlement, OKX hopes to move forward, but its troubles might not be over just yet. Here’s everything you need to know about the case and what could come next.

What Did OKX Do Wrong?

Although OKX claimed to block U.S. customers, the DOJ found that the exchange actively sought them out. Acting U.S. Attorney Matthew Podolsky stated that OKX processed billions in criminal proceeds and suspicious transactions. However, the settlement does not include claims of direct harm to customers.

OKX’s American branch, OKcoin, is also facing scrutiny. The Commodity Futures Trading Commission (CFTC) issued a subpoena on February 24, 2024, referencing fraud and other illegal activities tied to digital asset transactions. The CFTC is also investigating a flash crash in January 2024 that affected OKX’s native token, OKB.

The exchange has pledged to compensate impacted users.

Internal Compliance vs. DOJ Findings

In January 2024, OKX introduced an ethics and compliance helpline, urging employees to report any misconduct. However, DOJ findings suggest that some OKX employees previously advised users on how to bypass restrictions.

One key example cited by the DOJ involved an OKX employee telling a U.S. customer to falsify information during Know Your Customer (KYC) verification. The user was instructed to select a different nationality and enter random ID details.

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It Doesn’t Stop There

Despite claims that it blocked U.S. users since 2017, OKX actively marketed its services in the country. The DOJ pointed out that the exchange sponsored the Tribeca Film Festival and promoted itself to U.S. audiences. At least one America-based customer even shared a video on using a VPN to bypass restrictions and access OKX.

What’s Next for OKX?

With this settlement, OKX aims to resolve its legal troubles and continue operating in global markets. However, ongoing CFTC investigations could lead to more legal action. The exchange has not yet commented on the settlement, and the CFTC has also declined to make a statement.

This case is yet another example of regulators cracking down on crypto exchanges that fail to comply with U.S. laws, signaling stricter enforcement in the industry.

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