Cryptocurrency exchange Coinbase agreed to pay a $50 million penalty to New York state's Department of Financial Services to settle accusations that it allowed customers to open accounts without conducting sufficient background checks.
The DFS said Coinbase had made itself vulnerable to being used for serious criminal conduct, including possible money laundering. “It is critical that all financial institutions safeguard their systems from bad actors," Superintendent of Financial Services Adrienne Harris said in a statement.
The settlement deals a fresh setback to the crypto industry, which has been struggling for credibility after the collapse of crypto exchange FTX, hedge fund Three Arrows Capital and multiple lenders last year.