Major Exchanges Under Scrutiny
Published 8/2/2026, 12:15:49 PM
Research into cryptocurrency exchanges under scrutiny for scam inflows, money laundering, and cooperation failures reveals several major platforms beyond MEXC facing significant regulatory and legal challenges. The most prominent entities identified include HTX (formerly Huobi), KuCoin, Binance, and Garantex.
Major Exchanges Under Scrutiny
| Exchange | Primary Scrutiny / Allegations | Status & Key Data |
|---|---|---|
| HTX (Huobi) | Sanctions evasion, illegal promotions, and "opaque organizational structure." | UK FCA Legal Action (Feb 2026); EU Sanctions (July 2026). Traced to rotating crypto wallets to evade tracking. [Source: https://www.scworld.com/brief/htx-accused-of-rotating-wallets-to-evade-sanctions] |
| KuCoin | Operating an unlicensed money transmitter; $5B+ in suspicious inflows. | $297M Settlement (Jan 2025); Pleaded guilty to BSA violations; 2-year U.S. market ban. [Source: https://www.justice.gov/usao-sdny/pr/prominent-global-cryptocurrency-exchange-kucoin-and-two-its-founders-indicted-bank] |
| Binance | Obstructing law enforcement by changing cooperation protocols. | Ongoing Scrutiny (July 2026); NYT reports investigators find it "harder to fight crime" due to policy shifts. [Source: https://www.nytimes.com/2026/07/28/business/binance-crypto-investigation.html] |
| Garantex | Laundering $96B+ for ransomware, darknet markets, and sanctioned actors. | Disrupted (March 2025); $26M frozen; Administrators charged by U.S. DOJ. [Source: https://www.justice.gov/opa/pr/justice-department-announces-charges-and-disruption-multibillion-dollar-money-laundering] |
| Huione Group | Facilitating "pig butchering" and scam technology sales. | FinCEN Section 311 Designation (May 2025); $39.6B inflows in 2025 alone. [Source: https://www.fincen.gov/news/news-releases/fincen-designates-huione-group-primary-money-laundering-concern] |
Documented Cooperation Failures
- HTX (Huobi): A UK High Court found HTX guilty of breaching constructive trust duties in late 2024 after the exchange ignored warnings from a hack victim's legal team. The exchange reportedly allowed stolen funds to be laundered and refused to comply with a court order to return them [Source: https://www.lexology.com/library/detail.aspx?g=942babdb-280e-4403-905e-9c60260c1acf]. Additionally, HTX has been accused of rapidly rotating wallet addresses across multiple blockchains to circumvent sanctions screening [Source: https://www.scworld.com/brief/htx-accused-of-rotating-wallets-to-evade-sanctions].
- Binance: As of July 2026, global investigators have expressed frustration that Binance modified its internal procedures, making it more difficult for law enforcement to track scammers and combat money laundering [Source: https://www.nytimes.com/2026/07/28/business/binance-crypto-investigation.html].
- KuCoin: U.S. DOJ indictments revealed that KuCoin deliberately avoided implementing KYC/AML protocols until mid-2023 and actively coached U.S. users to hide their locations to evade regulatory oversight [Source: https://www.justice.gov/usao-sdny/pr/prominent-global-cryptocurrency-exchange-kucoin-and-two-its-founders-indicted-bank].
- Garantex: When Russian authorities requested records, the exchange reportedly provided incomplete data and falsely claimed that high-volume accounts were not verified to protect illicit users [Source: https://www.justice.gov/opa/pr/justice-department-announces-charges-and-disruption-multibillion-dollar-money-laundering].
Emerging Risks and Scam Venues
Beyond major exchanges, several "Guarantee" services (escrow platforms) have been flagged for processing over $103 billion in illicit inflows in 2025. These include Huione Guarantee, Haowang Guarantee, and Xinbi, which primarily serve pig-butchering operations and fraud shops. FinCEN designated Huione Group as a "foreign financial institution of primary money laundering concern" after it received $39.6 billion in 2025 alone [Source: https://www.fincen.gov/news/news-releases/fincen-designates-huione-group-primary-money-laundering-concern].
Regulators have also flagged several fraudulent trading platforms—often used in "pig butchering" scams—including Essential Crypto Exchange, Alphabet Trade, Provestics, and Volcanic Exchange. These platforms are typically not legitimate exchanges but rather front-ends for fraud.