ZachXBT says KuCoin threatened victim after $250,000 Atomic Stealer theft

KuCoin is facing renewed criticism after blockchain investigator ZachXBT said the exchange sent a legal warning to a victim who lost $250,000 in an Atomic Stealer theft. He said the stolen funds were routed through five KuCoin deposit addresses that used purchased mule KYC, or identities bought from third parties to pass verification checks. A screenshot shared by crypto community member DNBWIZARD appeared to show KuCoin customer care warning that “false or unlawful statements” could trigger legal claims. ZachXBT has escalated his criticism of the exchange in 2026, writing in May that KuCoin “does not assist victims or law enforcement” and calling the team “complicit.” In April, he asked KuCoin to explain how more than $9.5 million from a fake Ledger app was laundered through more than 150 KuCoin deposit addresses in one week, and said another $3.5 million from the Bitcoin Depot incident passed through at least 25 KuCoin accounts. The accusations come as KuCoin remains under regulatory and compliance pressure. The U.S. Department of Justice charged KuCoin and founders Chun Gan and Ke Tang in March 2024 with Bank Secrecy Act violations and operating an unlicensed money transmitting business. KuCoin pleaded guilty in January 2025, agreed to pay more than $297 million in penalties and to leave the U.S. market for at least two years. In March 2026, the CFTC separately ordered KuCoin to pay a $500,000 civil penalty and permanently barred it from serving U.S. users unless it registers as a foreign board of trade. In Europe, KuCoin secured a MiCA license in Austria in November 2025, but Austria’s FMA later halted new customer onboarding at KuCoin EU after the firm lost key anti-money laundering and sanctions compliance officers. The ban was later lifted, though full operations remain on hold pending further supervisory requirements.