OKX

The plea

The charging document is public and it is worth quoting rather than summarising. The Information filed in the Southern District of New York names "AUX CAYES FINTECH CO. LTD., d/b/a “OKEx,” d/b/a “OKX”" as the defendant, "a business entity incorporated in the Seychelles, which operates one of the highest-volume cryptocurrency exchange and trading platforms in the world" 1.

The count is operating an unlicensed money transmitting business. From 2018 until at least early 2024 the company served "U.S. retail and institutional customers that engaged in over one trillion dollars of transactions through OKX while OKX failed to register as a money services business" with FinCEN, "as OKX knew was required by U.S. law" 1. That last clause is the one that makes this a criminal matter rather than a regulatory one: not that the rule was missed, but that it was known.

The prosecutors also say the platform lacked adequate controls to tell whether either side of a transaction was subject to US Treasury sanctions, and that during the same period it was used "as a vehicle for laundering the proceeds of suspicious and criminal activities, including more than five billion dollars of suspicious transactions and illicit proceeds" 1. The company pleaded guilty and agreed to about $505m — an $84.4m fine and $420.3m forfeited — with an external compliance consultant in place until February 2027 and a quarter off the fine for cooperating 2.

The policy, and the gap between it and what happened

The most quotable part of the filing is the shape of the failure, because it is not a firm that lacked a rule. "Since at least 2017, and up to the present, OKX has had an official policy preventing U.S. persons from transacting on its exchange" 1. From December 2017 it blocked customers whose internet address was in the United States, and refused anyone who identified themselves as a US person on registration.

And then: "As OKX knew, during the Relevant Period, the IP Ban did not, in actuality, prevent U.S. customers from accessing OKX (through a work-around process) and trading on the exchange" 1. A control that was known not to work, left in place for six years, is a different thing from an oversight — and it is the reason the government charged a crime rather than writing a fine.

It was September 2023 before the company required identity checks from new and existing customers, closing positions and freezing withdrawals for those who did not complete them 1. That is the date the behaviour actually changed, and it is nearly six years after the policy said it already had.

What it does and does not tell you

Like the Binance resolution, this is about who the exchange let trade and what it did not stop, rather than about customer assets going missing. The Information charges one count, operating an unlicensed money transmitting business 1, and nowhere alleges that OKX lost or misappropriated a customer’s deposit.

What it does say is that the company operated for six years in a way its own policy prohibited, and that it took a criminal conviction to stop. For a reader weighing where to keep coins, that is information about how seriously this company treats a rule when the rule is inconvenient — which is the same question the solvency component is really asking and cannot answer directly.