New York Attorney General Letitia James has issued a stern warning to cryptocurrency companies, stating that she will pursue legal action against those that violate the law. In a recent post on the social media platform X, James emphasized that crypto firms must operate within the bounds of the law, just like any other business. "Crypto companies must play by the same rules as everyone else. We will go after those that don't," she declared.

This warning comes on the heels of a significant settlement reached between the NYAG and embattled crypto firm Genesis. The settlement, worth $2 billion, not only imposed a financial penalty on Genesis but also banned the company from operating in New York. The agreement established a victims' fund to compensate defrauded investors, including over 29,000 New Yorkers who lost a combined total of $1.1 billion through the Gemini Earn investment program.

Genesis' troubles began in November 2022 when the company halted withdrawals due to liquidity issues caused by the collapse of crypto hedge fund Three Arrows Capital. In October 2023, James filed a lawsuit against Genesis, its former CEO Soichiro Moro, and its parent firm, Digital Currency Group (DCG), alleging that they attempted to conceal $1.1 billion in losses. Reports of the NYAG's investigation into DCG's ties to Genesis first surfaced in August.

James' warning serves as a reminder that crypto companies are not above the law and will be held accountable for any violations. The NYAG's actions demonstrate a commitment to protecting investors and ensuring that cryptocurrency firms operate transparently and fairly. As the crypto landscape continues to evolve, it is crucial for companies to prioritize compliance and ethical practices to avoid legal repercussions.