In a move that could rival the most spectacular of slapstick routines, the New York State Department of Financial Services (NYDFS) has slapped Paxos Trust Company with a staggering $48.5 million fine-because apparently, AML and due diligence are just optional accessories, not necessities. Who knew? 🤡💸
Back in 2015, Paxos was given the royal seal of approval-nay, the golden ticket-to dabble in “virtual currency business,” under the solemn watch of NYDFS. A promise to keep things above board? Well, that vanished faster than Bitcoin in a bear market.
The department’s complaint claims Paxos was blissfully unaware of the need to actually watch Binance’s dance with US users-lax geofencing, anyone? The result? A perfect storm of $1.6 billion in dodgy dealings from 2017 to 2022, facilitated by the magic of unregulated exchanges. All the while, Binance was seemingly busy turning a blind eye to sanctions, while Paxos watched on-probably sipping tea and looking away. ☕🕵️♂️
Related: Binance Breaks the 280 Million Users Barrier, Aiming for the Big One-One Billion!
The ruling? Paxos is on the hook for a tiny $26.5 million for not doing its homework on Binance and a further $22 million to make its compliance programs less of a joke. All part of the grand “remediation plan,” because who doesn’t love a good retry? 🎯
A Paxos spokesperson, with their usual air of unwavering confidence, assured us via email that these issues-discovered over two and a half years ago-are now ancient history. No customer harm, no fuss, just another day in crypto paradise. Or so they say. 😅
Meanwhile, the social media universe is having a field day. Former SEC chief of staff Amanda Fischer-probably enjoying her coffee-shouted a hearty “Congratulations!” to NYDFS for catching Paxos facilitating a river of illicit funds. She also commended Paxos’s ex-chief risk officer for throwing some digital shade at her earlier. Ah, the sweet smell of regulatory fireworks and online schadenfreude. 🎆🤭
“Congratulations to @NYDFS for catching Paxos facilitating $1.6B in shady transactions, and kudos to Paxos’s ex-risk guy for lecturing me about crypto.”
Apparently, Fischer and Austin Campbell, the ex-CRO, have been exchanging barbs on X about the turmoil wracking US crypto regulation-because what’s more fun than a public spat pitting regulators against the industry? 🤔🔥
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2025-08-07 23:21