Coinbase, a major cryptocurrency trading platform, has reached a $100 million settlement with New York State over criminal activity using their resources.

Coinbase Global, Inc., founded in 2012, operates the largest cryptocurrency exchange in the United States. The company serves over 100 countries, but has no physical headquarters, making it one of the world’s largest purely remote businesses.

According to New York’s Department of Financial Services, Coinbase was responsible for monitoring their transactions for suspicious activity and did so inadequately, or too belatedly to do anything about it. New York requires all financial institutions operating in the state to monitor transactions for activity which might indicate scams, crimes, or trafficking.

“It is critical that all financial institutions safeguard their systems from bad actors, and the Department’s expectations with respect to consumer protection, cybersecurity, and anti-money laundering programs are just as stringent for cryptocurrency companies as they are for traditional financial services institutions,” Financial Services Superintendent Adrienne A. Harris said in a news release. “Coinbase failed to build and maintain a functional compliance program that could keep pace with its growth.”

The investigation by DFS took eight months, and revealed massive shortcomings in security. To help address them, half of the settlement is money Coinbase will be required to invest in a new compliance program, overseen by a state-approved independent monitor for a year.

The other $50 million is a penalty that Coinbase will pay to the state.

According to Paul Grewal, chief legal officer for Coinbase, the company “remains committed to being a leader and role model in the crypto space, including partnering with regulators when it comes to compliance.”

Grewal added, “We believe our investment in compliance outpaces every other crypto exchange anywhere in the world, and that our customers can feel safe and protected while using our platforms.”

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