KuCoin Token has lost more than 37% of its value since mid-March

After the impressive deal struck between former Binance CEO Changpeng Zhao and US prosecutors, the US set their sights on another central exchange they now accuse of regulatory misconduct and violating anti-money laundering policies in the US.

Since the news came out, KuCoin has experienced a myriad of problems, with the largest being the huge capital outflow currently ongoing. Customers are taking their money out as they do not want to get caught in the crosshairs of the US DOJ and CFTC.

The charges set against KuCoin are that the founders failed to maintain a reliable AML program and that KuCoin was operating an "unlicensed money transfer business" (KuCoin was allowing people to use the exchange to transfer money to other platforms and people without the proper licenses.).

The consequences of this pursuit have been strongly felt as KuCoin lost 74% of its daily trading volume since March 26, nise diving from $2 billion to $520 million. On March 26, the total value of outflows surpassed KuCoin’s inflows. More than 600 million USD, mainly USDT and ETH, were withdrawn from the exchange after information about the lawsuit spread.

KuCoin's daily net flows. Source: Nansen

What Should You Do?

Simple Answer - Follow Suit, Remove Your Liquidity.

Take your money out of KuCoin and watch from a safe distance. There is nothing like being too safe. We don't know how this will be settled, most likely through a heavy fine but that's still speculation. You do not want to get burned if there is a sudden discovery that KuCoin has less liquidity than they have been reporting, aka, another FTX situation. No central exchange deserves your complete trust. Be shrewd and alert, don't become a victim of circumstance.

If KuCoin survives, great for the crypto community, if they don't, at least you won't be caught up in court documents as a customer who lost their assets if bankruptcy is declared. Stay Safe.