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The NYDFS reportedly said that Paxos was unable to administer the token in a "safe and sound" manner and "violated its obligation to conduct tailored, periodic risk assessments and due diligence refreshes of Binance and Paxos-issued BUSD customers to prevent bad actors from using the platform.

"New York Attorney General Letitia James today filed a lawsuit against Alex Mashinsky, a co-founder and former CEO of cryptocurrency lending platform Celsius Network LLC and its related entities (Celsius), for defrauding hundreds of thousands of investors, including more than 26,000 New Yorkers, out of billions of dollars worth of cryptocurrency. The lawsuit alleges that Mashinsky repeatedly made false and misleading statements about Celsius's safety to encourage investors to deposit billions of dollars in digital assets onto the platform. As Celsius lost hundreds of millions of dollars of assets in risky investments, Mashinsky misrepresented and concealed Celsius's deteriorating financial condition. Mashinsky also failed to register as a salesperson for Celsius and as a securities and commodities dealer."

Following the NY AG's accusations of a $850M cover-up, Binfinex refutes the claims as 'riddled with false assertions' and that the funds are not lost.

The New York State Department of Financial Services authorized Bakkt Trust Company LLC to offer custody services for Bitcoin following the introduction of trading physically delivered Bitcoin futures contracts on the Intercontinental Exchange Futures U.S. Under its charter, Bakkt will provide services to institutional customers.

The New York State Department of Financial Services announced a techsprint initiative to convene regulators and industry stakeholders to work towards a common goal of Digital Regulatory Reporting, which aims to give regulators instant access to data provided by firms under their supervision. The techsprint's first area of focus is virtual currency companies due to their advanced digital capabilities operating in this space. This techsprint will be the first of its kind in the virtual currency space.

The New York Department of Financial Services reached a $100 million settlement with Coinbase over issues regarding the company's compliance programs. Coinbase will be required to pay $50 million as a penalty and invest an additional $50 million to bolster its abilities to comply with financial regulations, such as transaction monitoring and know your customer (KYC) rules. The department said it found "significant failures" in Coinbase's compliance program that violated New York Banking Law and state regulations regarding virtual currencies, money transmitting, transaction monitoring, and cybersecurity.