violations

A South Korean trader @solyfw34 accused the cryptocurrency trading platform LBank of restricting account withdrawals and trading after he profited from contract trading, resulting in some positions being unable to be manually closed and ultimately being forcibly liquidated. Currently, approximately 1 million USDT remains inaccessible. The user stated that LBank did not provide specific evidence of abnormal trading.On November 10, LBank responded that it would not restrict accounts solely due to user profits, and that the relevant accounts were suspected of violating internal rules. The user's invested principal has been fully withdrawn, and the restricted funds have been identified as related to abnormal trading. LBank has hired a South Korean law firm and stated that it will take legal action against false and defamatory statements. On-chain investigator ZachXBT criticized LBank as an offshore low-quality centralized exchange and questioned several KOLs for using highly similar rhetoric to defend the platform.

According to Caixin, on November 10, multiple media outlets saw the draft of the Digital Fairness Act, which shows that the European Commission plans to require companies to allow users to disable features that induce compulsive or excessive use, and to regulate AI systems that extend interactions through simulated interpersonal relationships. The draft is expected to be published on November 11, and companies that violate the rules may face fines of up to 6% of their global annual revenue. The draft requires that adult users be given the option to disable autoplay, notifications unrelated to their activities, and continuous reward systems; if an AI chatbot encourages ongoing interaction by simulating interpersonal relationships, users should also have the right to disable related features.The draft also proposes to list 10 types of manipulative designs that are considered unfair under any circumstances, including making it significantly harder to register for services, hiding prices or automatic renewal terms, falsely implying there are no other choices, making false or inadequately qualified claims about supply or popularity, repeatedly emphasizing scarcity at checkout, pre-selecting additional products or quantities, framing refusal as a wrong choice, repeatedly asking to change a decision already made, using confusing double negatives, and fabricating notifications that someone has contacted the user. The European Commission can add new manipulative practices to the list without restarting the legislative process.The draft also proposes to require online subscriptions to provide a clear contract termination button, that consumers must actively consent before a free trial converts to a paid service, and that reminders must be sent before automatic renewals; for minors, it proposes to ban paid loot boxes and paid win mechanisms in video games. Impact assessments estimate that the relevant regulations will help consumers avoid economic losses of 88.4 billion euros between 2025 and 2035; when accounting for time lost, the annual benefit is expected to be 13.7 billion euros, with total annual compliance costs for companies estimated at 678 million euros. The draft still needs to be reviewed by the European Parliament and member states, and according to the current text, it will apply 12 months after coming into effect. The German government expressed opposition in mid-last month, advocating for amendments to the existing consumer protection directive rather than creating a new law.

The U.S. Commodity Futures Trading Commission (CFTC) is once again investigating the prediction market platform Polymarket to determine whether it has violated the 2022 settlement agreement, focusing on whether it has taken adequate measures to prevent U.S. users from accessing the main overseas platform. This review is part of a broader investigation initiated by the CFTC earlier this year, involving user geographic location identification mechanisms, advertising activities in the U.S. market, as well as the customer account opening processes and protective measures of U.S. platforms.According to the 2022 settlement agreement, Polymarket agreed to cease providing services to U.S. users. In 2024, the CFTC and the U.S. Department of Justice conducted investigations, which concluded in 2025 without any charges being filed; thereafter, Polymarket gradually returned to the U.S. market through the acquisition of a licensed derivatives exchange. Polymarket previously stated that it has strengthened geographic restrictions, prohibiting circumvention through methods such as VPNs, and established monitoring mechanisms. There is currently no information indicating that the CFTC has filed formal charges regarding this investigation.

Binance founder CZ recently accepted an interview with Japanese business media PIVOT, discussing his decision to voluntarily go to the United States to plead guilty and pay a hefty fine. He emphasized that this was because he did not want to be a fugitive or evade issues. CZ stated that Binance was only involved in registration-related violations, with no fraud and no victims, and that users have always been well protected. Serving time was an unpleasant experience and a lesson.CZ also mentioned that recently, American banks have committed more serious violations but were only fined $1.2 billion and were not prosecuted. He stated that the world is inherently unfair, but he is no longer entangled in it and wants to focus on moving forward, learning from experiences to do more positive things.

According to Bloomberg, the Central Bank of Ireland has fined Coinbase's Irish subsidiary €3.25 million (approximately $3.6 million) due to deficiencies in its outsourcing governance framework and inadequate customer fund protection measures.Regulators pointed out that the company relied too heavily on the U.S. Coinbase Group to execute customer fund protection processes, and design flaws in the system along with insufficient control testing led to a long-term shortfall in the designated customer fund protection accounts.A Coinbase spokesperson stated that the relevant issues mainly occurred during the U.S. banking crisis in 2023, when the company directed customers to deposit funds into other bank accounts of Coinbase to mitigate potential losses from bank failures. However, this practice resulted in the mixing of customer funds with those held by other entities of Coinbase, which did not comply with regulatory requirements.Last year, the Central Bank of Ireland also fined Coinbase Europe €21.5 million for violating anti-money laundering and counter-terrorism financing transaction monitoring obligations (which included a 30% settlement discount).

According to Bloomberg, the New Taipei District Court in Taiwan has authorized Taiwan's communication regulatory agency and internet registration agency to block domestic access to Coinbase and the prediction market platform Kalshi, due to allegations of providing election betting services.This blockage occurs a few weeks before the local elections in Taiwan, which will test the public support for President Lai Ching-te's government. Some Coinbase users in Taiwan have reported that they have been unable to access the platform normally since Wednesday.

The Finance Committee of the French National Assembly has passed an amendment that proposes requiring the declaration of self-custodied wallet crypto assets with a year-end value reaching or exceeding €100,000 (approximately $112,000). Those who fail to declare may face fines of up to €10,000 (approximately $11,000). This regulation has not yet become law and may still be adjusted in the future.Harry Halpin, CEO of privacy infrastructure company Nym, stated that personnel from the French tax authorities are suspected of selling taxpayer data to criminals, and the new declaration requirements could threaten the safety of holders. Rand Hindi, founder of the privacy protocol Zama, urged French crypto asset holders to leave France, and those who cannot should hire security for their families.As this proposal emerges, France has seen several incidents of crypto asset robberies, kidnappings, and "ransom attacks" in recent years. The committee had also previously passed measures such as considering the exchange of crypto assets for stablecoins as a taxable sale and expanding the scope of the crypto asset exit tax, but the budget revenue portion was subsequently rejected by a vote of 31 to 3, and the related amendments need to be resubmitted.

The head of research at OpenAI issued a statement in response to an open letter from three former employees, Jasmine, Mikita, and Tomek. The company stated that after a thorough investigation, the three violated clear policies regarding the handling of sensitive information; serious breaches of trust discovered during the internal investigation exceeded the scope disclosed in the open letter, leading to the termination of their employment last week, a decision that will be upheld.OpenAI emphasized that this decision is not aimed at those who raise safety concerns or express opinions publicly. The company stated that there are intense and critical safety and research discussions internally every day, and it encourages questioning; it maintains a tolerance for good-faith mistakes and will not fire employees for raising concerns.Regarding the safety issues mentioned in the open letter, OpenAI stated that it is finalizing contracts with third-party security assessment organizations, with details expected to be announced in the coming weeks, and it is committed to including external evaluators in its safety work. The company recognizes that maintaining the monitorability of cutting-edge models requires collective investment from the entire industry, stating that this area has long been a focus of its research and will continue to receive significant resources.

According to Decrypt, Judge Rosemarie Aquilina of the Ingham County Circuit Court in Michigan has issued a preliminary injunction against the prediction market platform Kalshi, requiring it to stop offering sports betting-related contracts to Michigan residents. The court found that Kalshi's related business is essentially "sports betting disguised as investment opportunities."Under the order, Kalshi must block in-state users through a third-party geolocation service licensed by the Michigan betting regulatory agency, or face a daily fine of $500,000. The injunction also prohibits it from allowing account registration, deposits, advertising, and similar sports betting product features for Michigan residents until a final judgment is made in the case.

According to a Reuters report, Polymarket's new Global Head of Research and Intelligence, Shana Bautista (former analyst at Coinbase, former investigator at the FBI), stated that as the U.S. midterm elections approach, Polymarket has established a system to identify unusual trading activities and will continue to prevent U.S. users from using its international platform to comply with the settlement agreement reached with U.S. regulators in 2022.In addition, Polymarket plans to launch a new webpage to publicly disclose the operational details of market integrity review mechanisms such as machine learning, blockchain analysis, and trading monitoring, and revealed that it has referred over 100 cases to law enforcement agencies.

Fox Business crypto reporters posted on the X platform that the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation are advancing the finalization of a rule to define "unsafe or unsound practices" in bank regulation. This term has not been clearly defined for years, primarily relying on the broad discretion of bank examiners.Under this rule, when regulators determine that a practice is "unsafe or unsound," they must link it to actual illegal conduct or significant financial risk, thereby reducing the likelihood of pressuring banks serving legitimate clients, including crypto companies, based on vague reputational or procedural issues. This rule marks another important step towards further dismantling "Operation Chokepoint 2."

The People's Bank of China Shenzhen Branch, Shenzhen Securities Regulatory Bureau, Municipal Internet Information Office, and Municipal Local Financial Supervision Administration continue to carry out special rectifications, urging local website platforms to strictly implement their main responsibilities and legally handle a number of illegal self-media accounts.Some typical cases include: "USDT Merchant Group Chat," "Gather Together to Play Virtual Currency," "Search for Bitcoin," "WeChat Quick Exchange," "Zhongchain Laojiu," "Medicine Breaks a Good Sleep," "Little Goldfish 9884," "User 0767527971," and other accounts that illegally provided marketing and promotional information related to virtual currency business activities within the country, enticing the public to participate in illegal financial activities related to virtual currency. According to the relevant policy provisions such as the "Notice on Further Preventing and Handling Risks Related to Virtual Currency," the aforementioned accounts have been permanently closed and dealt with by the platform in accordance with the law and agreements.

According to Cointelegraph, Vietnam issued Decree No. 284/2026/NĐ-CP on July 16, officially establishing an administrative penalty framework for cryptocurrency violations, providing a legal basis for the upcoming regulated cryptocurrency market.According to the decree, investors trading on unlicensed platforms face fines of up to 50 million Vietnamese dong (approximately $1,900); unauthorized issuance of crypto assets and serious anti-money laundering (AML) violations can incur fines of up to 200 million Vietnamese dong (approximately $7,700); authorities are also authorized to suspend related activities, revoke licenses, and confiscate assets.The decree will officially take effect on September 1. In terms of background, Vietnam opened applications for domestic cryptocurrency exchange licenses in January this year, and Deputy Minister Nguyen Duc Chi previously stated that the first batch of regulated activities is expected to launch in the third quarter.

According to the Securities Times, Xiaohongshu has launched a special governance action for certified professional accounts in the financial sector starting from June 3. Based on relevant laws and regulations as well as platform rules, financial certifications are only issued to institutions holding compliant licenses. The nicknames of certified professional accounts on the platform must strictly match the actual business scope of the certified entity and must not obtain certification marks through false or misleading information. In the past week, Xiaohongshu has dealt with over 1,500 non-compliant financial professional accounts and will continue to comprehensively strengthen the public verification and validation mechanism, conducting regular inspections and handling of existing accounts.Staff introduced that since May, the Xiaohongshu platform has dealt with a total of 31,000 accounts involved in financial sector violations and marketing accounts without financial-related qualifications, including 539 notes and 146 comments related to illegal inducement of cross-border investment issues; 141 related notes regarding the low-priced resale of foreign investment bank research reports, and freezing of 132 related products. In addition, the platform has also handled over 130 pieces of suspected illegal information related to gold financial marketing promotion and domestic promotion of overseas platforms.

According to a report by Reuters citing the German newspaper Handelsblatt, the European Union is planning to impose fines in the hundreds of millions of euros on Google's parent company Alphabet in response to its alleged violations of the Digital Markets Act (DMA). Sources indicate that a related decision is nearing completion and is expected to be announced before the summer recess, potentially becoming the largest fine issued by the EU under the DMA.The investigation officially began in March 2025, focusing on whether Google prioritizes its own services in search results, thereby harming fair competition in the market. The European Commission stated that its primary goal is to ensure corporate compliance rather than simply imposing penalties, but if the corrective measures do not meet regulatory requirements, enforcement procedures will continue. Google responded that the adjustments made to its search products in accordance with DMA requirements have significantly impacted user experience and expressed a desire to reach a resolution with regulators.

The Federal Court of Australia ordered Binance's Australian derivatives division (i.e., Oztures Trading Pty Ltd) to pay a fine of AUD 10 million (approximately USD 6.9 million).During the period from 2022 to 2023, the entity incorrectly classified over 85% of local customers as wholesale investors, resulting in 524 retail customers being exposed to high-risk crypto derivatives without statutory consumer protections, leading to trading losses of approximately AUD 8,660,000 (about USD 5.9 million) and fee losses of AUD 3,900,000 (about USD 2.7 million). Joe Longo, Chairman of the Australian Securities and Investments Commission (ASIC), stated that Binance failed to establish basic compliance review mechanisms and incorrectly approved hundreds of wholesale investor applications. According to the fact statement submitted to the court, Binance acknowledged flaws in its customer onboarding process, allowing applicants to repeatedly take the eligibility test until they passed, and that senior compliance personnel inadequately reviewed application materials. Binance admitted to six violations, including failing to provide product disclosure statements to retail customers, not conducting target market assessments, and not maintaining a compliant internal dispute resolution system. This fine is in addition to approximately AUD 13.1 million (about USD 9 million) in customer compensation previously supervised by ASIC. The entity's Australian financial services license was revoked in April 2023.

A leading polysilicon company in Xinjiang was fined and had illegal gains confiscated by regulatory authorities for supplying power to virtual currency mining activities, with a total amount exceeding 100 million yuan.The background of the relevant rectification shows that local authorities are intensifying regulation of virtual currency mining, requiring comprehensive inspections and strictly prohibiting companies from illegally transferring power in any form. Currently, Xinjiang has clearly classified virtual currency mining as an industry to be eliminated, and related law enforcement actions are ongoing.

The founder of OpenClaw, Peter Steinberger, responded on social media regarding "a user being banned after mentioning Bitcoin in OpenClaw's Discord," stating, "We have strict server rules, and users agree to comply with them upon entering the server. One of these rules is a complete ban on mentioning cryptocurrencies."Afterward, Peter Steinberger inquired about the user's account name, indicating that he would manually re-add them to OpenClaw's Discord group.

The U.S. Department of Justice announced that the cryptocurrency trading platform Paxful Holdings Inc. has been fined $4 million for failing to establish effective anti-money laundering controls.Prosecutors alleged that the platform has long allowed illegal funds related to fraud, prostitution, and human trafficking to flow through it, profiting from these activities. The Department of Justice stated that Paxful was aware that some customer funds were derived from criminal activities but continued to provide services, using lax anti-money laundering regulations as a selling point to attract users. The investigation also pointed out that the platform processed cryptocurrency transactions for websites including Backpage, which is believed to have been used to post advertisements related to prostitution, involving minors. Data shows that from 2015 to 2022, approximately $17 million worth of Bitcoin flowed through Paxful wallets to related websites, with the platform earning at least $2.7 million in profits from this. The Department of Justice stated that Paxful's founder even referred to the resulting business growth as the "Backpage Effect."

According to CoinDesk, India's federal budget for the fiscal year 2026-27 maintains the existing 30% cryptocurrency capital gains tax and 1% withholding tax, disappointing industry groups that had sought tax reductions. The government did not adjust the tax rates but proposed new penalties for entities that fail to properly report cryptocurrency transactions under Section 509 of the Income Tax Act starting from April 1, 2026.Failure to submit the required reports will incur a daily fine of 200 rupees (approximately $2.2) until the non-compliance ends. If the submitted information is incorrect, or if errors are not corrected after being discovered, a fixed penalty of 50,000 rupees (approximately $545) will be imposed. Officials stated that this move aims to strengthen compliance, but market participants warn that it will continue to create friction for traders.