Securities Regulation Daily Wrap Up, BLOCKCHAIN—S.D.N.Y.: KuCoin’s operator to pay $500,000 penalty for failing to register with CFTC, (Mar 31, 2026)

By Suzanne Cosgrove

The consent order does not seek disgorgement based on the circumstances of the case.

The U.S. District Court for the Southern District of New York has entered a consent order against Peken Global Limited, the crypto exchange KuCoin’s operator, a company incorporated under the laws of the Turks and Caicos Islands, for allowing U.S. participants to trade on the exchange without registering with the CFTC as a foreign board of trade (CFTC v. MEK Global Limited, No. 24-CV-02255 (VEC) (S.D.N.Y. March 30, 2026)).

According to the filing, from at least July 2019 and continuing to at least June 2023 (known as the relevant period), direct access to KuCoin’s electronic trading and order-matching system was permitted either through its website, which was accessible to members or other participants located in the United States, or through a downloadable app, which was available on Apple, Google, and Android mobile devices located in the United States.

During the relevant period, KuCoin listed commodity derivative products for trading, including quarterly delivery futures referencing bitcoin, ether, litecoin and other digital assets that are defined as commodities under Section 1a(9) of the Act, 7 S.C. § 1a(9). According to the filing, approximately 1.54 million members or other participants located in the U.S. entered trades directly into the KuCoin exchange during that period, generating approximately $110 million in trading fees.The order permanently enjoins Peken Global from future violations, as charged, and to pay a $500,000 civil monetary penalty. The order also states that CFTC is not seeking, and the court is not imposing, disgorgement based on the facts and circumstances of the case.

These circumstances include Peken Global’s cooperation in a CFTC investigation and related proceedings, including the criminal action, United States v. Flashdot Limited, et al., No. 24-cr-168 (S.D.N.Y), and the judgment entered in that matter, in which Peken Global was subject to, inter alia, a forfeiture order, as reflected in the consent preliminary order of forfeiture/money judgment in the criminal action.

In parallel criminal action, Peken Global pleaded guilty to one count of operating an unlicensed money transmitting business.

The court also entered an order of voluntary dismissal with prejudice, dismissing all claims the CFTC brought against the other defendants: Mek Global Limited, PhoenixFin PTE Ltd., and Flashdot Limited.

The consent order, together with the order of voluntary dismissal, resolve previous claims the CFTC brought against Peken Global and the dismissed defendants in the complaint. Those prior charges include allegations that KuCoin illegally dealt in off-exchange commodity futures transactions and leveraged, margined, or financed retail commodity transactions, and solicited and accepted orders for commodity futures, swaps, and leveraged, margined, or financed retail commodity transactions without registering with the CFTC as a futures commission merchant.

The order also dismisses with prejudice counts II through V of the CFTC complaint filed March 26, 2024, against Peken Global.

Attorneys: Patryk J. Chudy for the CFTC. Christopher Lloyd Lavigne (Allen Overy Shearman Sterling US LLP) for Mek Global Ltd., PhoenixFin Pte Ltd. and Flashdot Ltd.

Companies: Mek Global Ltd.; PhoenixFin Pte Ltd.; Flashdot Ltd.

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