KuCoin Again at Center of Scandal: $9.5 Million in Stolen Crypto Funds Flowed Through Exchange
Major crypto exchange KuCoin has been implicated in a new money laundering scandal. Blockchain researcher ZachXBT found that over $9.5 million stolen via a fake Ledger Live app passed through its services. For ordinary users, this matters: if even well-known exchanges can’t—or won’t—block criminal transfers, the security of your assets is in question.
How the Fraudsters Stole Millions
It all began when attackers created a counterfeit version of Ledger Live—the official wallet app from Ledger. The app made it onto the App Store and looked so legitimate that over 50 users entered their secret seed phrases. It’s like handing your house keys to a stranger: immediately after, criminals gained full access to victims’ accounts.
Among the stolen assets were Bitcoin, Ethereum, stablecoins USDT and USDC, as well as Solana and Ripple tokens. One victim lost nearly $2 million in a single hit. Apple removed the fake app only days later—after the damage was already done.
Why KuCoin Raises Red Flags
ZachXBT discovered that the stolen funds quickly ended up on KuCoin. The criminals used over 150 deposit addresses on the exchange to obscure their tracks. The funds then passed through the centralized mixer AudiA6—a service that blends cryptocurrency from multiple users, making transactions nearly untraceable.
The researcher highlighted three alarming issues:
- Instant swaps: KuCoin allows immediate token exchanges with no delays.
- Weak KYC: Know Your Customer verification procedures are easily bypassed.
- Mixing features: The platform itself offers tools that function almost like laundering services.
This creates a "fast lane" for criminals: steal → transfer to KuCoin → swap → withdraw. All in minutes.
History Repeats Itself
This isn’t the first time KuCoin has drawn regulatory scrutiny. Last year, the exchange admitted to operating without a license in the U.S. and paid nearly $300 million in fines. Its founders stepped down, and the company pledged to exit the American market. Yet in March 2026, a New York court imposed an additional $500,000 fine for failing to register with the CFTC (Commodity Futures Trading Commission).
Nonetheless, KuCoin continues operating globally and remains one of the most popular exchanges in Asia and Latin America. But now the question arises: has enough been done to prevent future laundering incidents?
What Matters
- $9.5 million stolen via the fake Ledger Live app flowed through KuCoin.
- The exchange enables rapid swapping and withdrawal of funds, facilitating money laundering.
- ZachXBT linked KuCoin to the centralized mixer AudiA6.
- This is the second case in a week: earlier, 50 BTC stolen from Bitcoin Depot were withdrawn through the same addresses.
- KuCoin has already been fined by U.S. authorities for regulatory violations.
What This Means for Regular Users
If you use crypto exchanges—especially those not regulated in your country—your risks are higher. Even "big" platforms may fail to block suspicious transactions. Always verify where you download wallets—only from official sites. And remember: if a service offers instant swaps without strict verification, it’s convenient not just for you, but for criminals too.
— Editorial Team
