OKX Settles $500M Case with U.S. Authorities Over Compliance Violations

OKX, one of the largest cryptocurrency exchanges, has settled with the U.S. Department of Justice (DOJ) over allegations of operating without a money transmitter license. The exchange’s affiliate, Aux Cayes FinTech Co. Ltd., agreed to pay over $500 million in penalties and forfeited fees, according to a press release.

The DOJ revealed that OKX actively sought U.S. customers, including those in the Southern District of New York, while failing to meet regulatory requirements. Officials further alleged that the exchange facilitated over $5 billion in suspicious transactions and criminal proceeds.

A person familiar with the matter told CoinDesk that the settlement resolves past allegations of fraudulent and non-compliant activities at OKX. Meanwhile, OKcoin, the U.S. division of OKX, received a subpoena from the Commodity Futures Trading Commission (CFTC) on Feb. 24, 2024, related to alleged fraud in digital asset transactions.

The CFTC is also investigating last year’s flash crash of OKX’s native token, OKB, which saw a sharp price drop on Jan. 23, 2024. OKX later pledged to compensate users affected by the crash.

In an internal document circulated to staff in January, OKX introduced an ethics and compliance helpline for reporting policy violations and suspected illegal activity. However, the company has not issued an official statement on the DOJ settlement. The CFTC also declined to comment on the ongoing probe.

This high-profile settlement underscores the growing regulatory scrutiny on crypto exchanges operating in the U.S., reinforcing the need for stricter compliance measures across the industry.