New York Attorney General files lawsuit against KuCoin, claims Ethereum is a “Security”

The crypto space has been subjected to consistent regulatory actions for a while now. However, New York Attorney General Letitia James’ office is not only focusing on increasing its pace of crypto crackdown but also making certain proclamations on the way.

Crypto exchange KuCoin goes down

The office of Letitia James on Thursday announced that the Attorney General had filed a lawsuit against the cryptocurrency exchange KuCoin. KuCoin became the latest subject of James’ pursuit of bringing down crypto companies that are operating in violation of the laws. Commenting on the lawsuit, James stated,

“One by one my office is taking action against cryptocurrency companies that are brazenly disregarding our laws and putting investors at risk. All New Yorkers and all companies operating in New York have to follow our state’s laws and regulations.”

Detailing the reason behind suing KuCoin, James said that the exchange was buying and selling crypto assets without being registered in the state of New York. Through the lawsuit, the Attorney General is looking to not only stop operating in the state but also block access to the website until the exchange complies with the law.

In addition to this, Letitia James also filed a petition in the court, which claimed that Ethereum, akin to Terra Luna (LUNA) and Terra USD (UST), is a security. Since no clear framework is available in regard to this, the Office of the Attorney General (OAG) became the first regulator to make such a claim. The petition noted,

“ETH, just like LUNA and UST, is a speculative asset that relies on the efforts of third-party developers in order to provide profit to the holders of ETH.”

Justifying the actions taken against KuCoin, James stated that the exchange company must be held accountable in order to protect investors. More details regarding the same are yet to arrive.

Letitia James continues the attacks

This is the second major instance of a crypto crackdown since the beginning of the year. The first was noted back in January when Letitia James filed a lawsuit against Celsius founder and CEO Alex Mashinsky. 

Per the filing, the Attorney General seeked to ban Mashinsky in the state from ever conducting or participating in a business. This is because, according to the filing, the founder was defrauding thousands of thousands of investors by hiding the company’s dire financial conditions.