Kucoin's BTC, ETH, and USDT reserves dip after charges from US DoJ and CFTC

Kucoin's reserves have been depleting as charges from US DoJ are prompting caution from users.
Daily trading volume and market share of Kucoin have dropped 284% and 50%, respectively, despite airdrop incentives, said Kaiko.
Kucoin is back on Google Play Store in India after FIU registration.

Crypto exchange Kucoin's latest reserve certificates, dated March 31, show a significant decline in its reserves of Bitcoin (BTC), Ethereum (ETH), and Tether USD (USDT). This decline is accompanied by increased outflow, which has seen Kucoin's market share drop more than 50% after charges from the US Department of Justice (DoJ) and the Commodity and Futures Trading Commission (CFTC).

Kucoin faces serious charges from the DoJ and CFTC

Kucoin and its founders were charged on March 26 by the DoJ for "conspiring to operate an unlicensed money transmitting business and (...) violate the Bank Secrecy Act." The DoJ argued that Kucoin didn't maintain a comprehensive anti-money laundering (AML) and know-your-customer (KYC) procedure that should have prevented its platform from being used in money laundering and terrorist financing operations.

US Attorney Damian Williams said Kucoin's operation outside the scope of the financial market allowed money launderers to use the platform to send and receive a combined $9 billion of suspected criminal funds. The CFTC also filed an enforcement action against the exchange for providing futures products without registering with the commission.

Also read: KuCoin Exchange to incentivize customers with $10 million airdrop amid DoJ, CFTC-related lawsuit

Kucoin is experiencing a significant drop in its assets reserve

Kucoin saw massive outflows worth $1.19 billion 24 hours after the charges. The decline since then is quite visible in its latest asset reserve certificate. Compared to its last reserve certificates from February 29, Kucoin witnessed an average decrease of nearly 23% among BTC, ETH, and USDT. Its BTC assets plunged more than 25%, while those of ETH and USDT were down 21.9% and 21.5%, respectively.

A report from research firm Kaiko measures the broader impact of the charges on Kucoin, as its daily trading volume has dropped from around $2 billion to $520 million. According to the report, its market share also dropped more than 50% despite Kucoin's $10 million airdrop incentive to prevent users from leaving. The report also highlighted that most outflows in Kucoin went to onchain wallet addresses and centralized exchanges such as Coinbase, Binance, OKX, MEXC, etc.

Despite the uncertainty surrounding Kucoin, some Indian users have noted in several X posts on Wednesday that the exchange's app is now back on the Google Play Store in India. This follows Kucoin's successful registration with India's Federal Intelligence Unit (FIU).

Share: Cryptos feed

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram