Archive · 7 Aug 2025
Paxos Settles with New York for $48.5M over Binance Lapses
Imagine a company called Paxos that helps with cryptocurrencies.
They had a deal with a big crypto exchange called Binance.
New York regulators checked Paxos and found they weren't careful enough about stopping bad guys from using Binance.
This included Ponzi schemes and people on a sanctions list.
So, Paxos has to pay $48.5 million, including a fine and money to improve their systems.
They also had to stop working with Binance after the regulators stepped in.
Paxos says they've fixed the problems and no customers were hurt.
Paxos Trust reached a $48.5 million settlement with New York regulators.
The settlement resolves charges related to Paxos's failure to police illegal activity on Binance.
Paxos will pay a $26.5 million fine and invest $22 million in compliance upgrades.
New York regulators found $1.6 billion in illicit transactions on Binance involving Paxos.
Paxos ended its partnership with Binance after being ordered to stop issuing Binance's stablecoin.
- Who
- Paxos Trust and New York's financial services regulator.
- What
- Paxos Trust settled for $48.5 million with New York over Binance-related lapses.
- When
- The settlement was reached recently.
- Where
- New York
- Why
- To resolve charges that Paxos failed to police illegal activity related to cryptocurrency exchange Binance.
Regulators' Perspective
Paxos's Response
Compliance Failures
Regulators' Perspective
Paxos failed to adequately monitor and control activity, including illegal transactions, on Binance.
Paxos's Response
Paxos states it has fully remediated compliance issues.
- Settlement Amount
- $48.5 million
- Civil Fine
- $26.5 million
- Compliance Upgrade Investment
- $22 million
- Illicit Transactions on Binance (related to Paxos)
- $1.6 billion
- Binance's Criminal Penalty
- $4.32 billion